Islamic finance industry has been looking for reforms in a bid to secure its future growth by attracting investors from the Western World. The finance industry remained under intense pressure in the past due to tough conditions of state-owned Dubai World and its subsidiaries.

The crisis hit Dubai World shocked the financial World by announcing standstill on its loan obligations in November last year. Dubai World is currently under restructuring exercise of a debt worth $26 billion and is in discussions with some key creditors. However, timely help from Abu Dhabi staved off default of Dubai World’s unit Nakheel.

Michael McMillen, partner at law firm Fulbright & Jaworski LLP said, "The Islamic finance industry hadn't been through its first crisis at that point and people didn't know what to think."

Industry has been looking for clearer bankruptcy laws and improved transparency in the system for avoiding any crisis in future. However, lack of clarity over Dubai World's ultimate resolution has been adding delay in future investment plans of the industry.