Pakistani Ambassador Maliha Lodhi arrived three weeks ago, in time to present a copy of her credentials to the State Department and to get sucked into the around-the-clock suspense of an airplane hijacking by Kashmiri militants who India claims are Pakistanis.

But living on the edge is not a novelty for her.

Returning to Islamabad in 1997 after her first ambassadorship here, she took her old job as editor of the News. Like other journalists and editors battling for free speech in Pakistan, she demonstrated against repression of the media. As things got nastier under the government of Nawaz Sharif, with threatening calls and surveillance outside her house by undercover agents in white Toyotas, she decided to take a "breather" as a visiting fellow at the International Institute of Strategic Studies in London.

She kept writing editorials and running the paper by e-mail, fax and telephone, she said. After the military coup d'etat on Oct. 12, she got a call from Pakistan's new leader, Gen. Pervez Musharraf. He wanted her to come and talk about how to "help us fix this country and put Pakistan back on track again." She suggested doing what she was already doing, but she was urged to re-engage an old and frayed friendship with Washington as ambassador.

Lodhi had expressed her opposition to military regimes during the days of Zia ul-Haq and took a week to make up her mind, consulting with relatives and friends. This was a national crisis, she was told, and the country was left with no other option.

"Only the form, the label of democracy was left, not the substance," she said Monday in her office, draped in a pale jade and gold silk serwal kamis with a salmon floral print. "The parliament, the judiciary were all degraded as institutions. I thought long and hard. I was convinced and reassured that this government had come to reform, not to rule."

With a $35 billion debt and the daunting task of disbanding militias and collecting weapons, Pakistani leaders have their work cut out for them. "So many problems of reforms have to be tackled so the system does not dissolve into a kleptocracy," she said. "To me the choice is very clear. Do I help the only country I have or do I sit it out?"

ISO Head of IMF

The elusive search among the top financial institutions of Europe for a new head of the Washington-based International Monetary Fund is a high stakes game of hide and seek.

The German government is sticking to its only candidate, Caio Koch-Weser, who left Washington and a 25-year career at the World Bank last year to become deputy finance minister at home. But other European capitals, mainly London and Paris, remain ambiguous, while the U.S. Treasury Department has effectively blocked him. The present head, Michel Camdessus, a Frenchman, steps down in a month's time. British Chancellor of the Exchequer Gordon Brown, the prime minister in waiting after Tony Blair, and Brown's predecessor, Kenneth Clarke, have brushed aside speculation they will take the top IMF job, traditionally reserved for a European. Nigel Wicks, another Briton whose name was mentioned, has also been quoted as saying he wants to stay home rather than come to Washington.

Treasury Secretary Lawrence H. Summers has proposed a swap of positions between the IMF and the president of the World Bank, which has always gone to an American. But his idea has met with European opposition.

"This would be a very bad idea for the world. The IMF fights against financial mismanagement while the World Bank fights against poverty. One deals mainly with the developed world, while the other deals with the developing world. If the swap took place, it would give the Americans yet another powerful position over developed markets," noted one European diplomat.

Reports that outgoing Israeli central bank governor, Jacob Frenkel, may get the job while the Europeans remain indecisive surfaced in London last week. Israel has been lumped with southern Europe at the IMF. However, Merrill Lynch & Co. announced yesterday it has appointed Frenkel to a senior position to map out global business strategies with governments, multilateral financial institutions and banks. He was the IMF's chief economist and head of research for six years until 1991.

If France's Finance Minister Jean-Claude Trichet wanted the job, which one European diplomat said was the habitual "hunting reserve of the French, he could have it." But he is committed to take over the European Central Bank from Dutch economist Wim Duisenberg in Frankfurt when he steps down.

"The French insist it has to be a European candidate and that there should be European consensus behind him. France has never manifested in any way opposition to Koch-Weser," another European diplomat said yesterday. Officially, there is no British candidate and France is not saying it has no candidate, whatever that means.

Pray for no major financial crises before the big boys make up their minds at the G-7 summit in Japan later this month. The United States, Japan, Germany, France and Great Britain control 42 percent of the vote. Is this global gig working?