LYON, FRANCE — LYON, France's second city, counts numerous high-spired churches among its neighborhoods, a grandiose basilica on a hill dominating the commercial center - but no mosque for the estimated 10 percent of the population that is Muslim. A 10-year-old project for a ``grand mosque'' has been mired in local opposition, financial difficulties, power struggles within the Islamic community itself - even, to some extent, the Gulf crisis - and is barely closer to realization than when it was first proposed by former President Val'ery Giscard d'Estaing in 1980.
The difficulties the Lyon mosque project has encountered exemplify the ambivalence with which a largely nonreligious France approaches religious practice in general. Some residents who oppose the project say they simply class it with any other large project that would threaten to become a ``nuisance'' in their neighborhood.
But the mosque - which would cost $15 million, accommodate 2,500 people, and include a 75-foot minaret - has also run into against growing French concern over the rise of Islam - now the country's second-largest religion. If the extreme-right National Front's slogan, ``No to the Mosque-Cathedral,'' quickly caught on with other opposition groups, it is because there is a deepening fear of what the National Front's Jean-Marie Le Pen calls the ``threatening Islamization'' of France.
Equating a mosque with a cathedral, and the power it connotes, is smart politics for Mr. Le Pen, and demonstrates just where French worries lie. ``Even if there is general recognition of the legitimacy of a mosque in Lyon,'' says Alain Battegay, a sociologist at the University of Lyon, ``there is resistance to such an important symbol of Islam.''
Hostility toward Islam - and the places of worship that mark its presence - was suddenly splashed on front pages in August 1989, when the mayor of the small city of Charvieu-Chavagneux, east of Lyon, hired a bulldozer to raze an old factory where a small mosque had been established.
The mayor, a conservative Gaullist who had never hidden his hostility toward the mosque, insisted the demolition was a mistake. But he was nonetheless treated to the ``reprobation'' of the Socialist government and was found guilty of destruction of private property and impeding the freedom of worship.
Charvieu's mayor recently refused a construction permit for a new mosque, saying the land was already slated for the extension of a municipal sports center, but a court overturned the refusal.
Such official hostility is not the case in Lyon, however. The city's youthful mayor, Michel Noir - also a Gaullist - officially endorsed the project just as opposition was awakening from its dormancy during the controversy last year over the wearing of veils by Muslim girls in public-school classrooms.
The city has offered a piece of land on the east side, and has issued a building permit that is valid through August 1991. Warning, however, that the project cannot be allowed to drag on ``eternally,'' the city says financing must be in place by the end of this year, or it will consider the project dead. The city has at least one practical reason for wanting the project to succeed. In the absence of an official mosque, innumerable small places of worship have sprung up in basements, attics, and empty buildings, often causing tensions with neighbors. The opening of a mosque would allow the city to stop such mushrooming.
But the financing deadline will be hard to meet, especially with a rival mosque project coming from a second Islamic group that is publicly calling the original project into question.
Backers of the official project have claimed to have major underwriting from Saudi Arabia and Kuwait, but lately that assertion has been thrown into doubt. Recently the general secretary of the Islamic organization responsible for the mosque project said the Gulf crisis had diverted Kuwait's attention ``with other cats to skin.''
The Saudi ambassador to France said last month his government had made no promises to anyone about the project. At the same time the ambassador said he would recommend to his government that it support financially the construction of a mosque in Lyon - ``provided the Islamic community can reach an agreement on a project.''
The rival project now proposed by a small group of Muslim businessmen and college students calls for a combination mosque and Islamic cultural center. It does not include a minaret.
``Islam's strength is its adaptability,'' says Louaifi Bennaoum, president of the group proposing the alternative project. ``We don't need a minaret any more than people need the telephone of Graham Bell in an age of advanced telecommunications.''
What Mr. Bennaoum says young Muslims in Lyon do need, however, is a ``point of reference'' where they can learn to place their Islamic culture in the context of life in France.
``Our young Arabs should retain their religion and culture,'' he says, ``but they should do so by learning to live by the rules of their country.''
He says he is opposed to any mosque that would be handed to local Muslims ``on a silver platter.''
``If the community wants its mosque, it should merit it,'' he says, ``by paying for it itself.''