FGM is an african traditional practice. Has nothing to do with Islam. For the love of god google some decent respectable webistes like Amnesty and HRW.
I think there are some Muslims who believe it's sunnah as it's been mentioned that to remove a very very tiny part of the hood can make sex more pleasurable for a woman. I have heard tho that it's a weak narration. I'll try and dig it out. Obviously, the way female circumcision is practised now is totally haram, damaging the girl's body and leading to a life of pain and misery (that is if they don't bleed to death or die of infection whilst having it done) as well as the concept as using it as a means to 'control' her and diminish any sexual enjoyment. Nobody as far as I'm aware close to Prophet Mohammed (PBUH) inc his own daughters underwent any type of female circumcision.
Anyone wanting an insight into how it's practised in Africa should read 'Desert Flower' by Waris Dirie - v.informative book about a very personal story, had me in tears..