By Missy Ryan
WASHINGTON (Reuters) - The U.S. ambassador to Islamabad, Cameron Munter, plans to step down this summer, and the Obama administration, hoping to improve dismal ties with Pakistan at a crucial time for its war in neighboring Afghanistan, is considering a senior official at its Kabul embassy to replace him.
The White House is focusing on Richard Olson, who has orchestrated U.S. development and economic activities in Afghanistan since June 2011, to succeed Munter when he departs in coming months, sources familiar with the discussions said.
Olson would have to be formally proposed by the White House and confirmed by the Senate. The White House declined to comment on a personnel matter.
Munter, who was sworn in as ambassador to Pakistan in October 2010, has served during a period of unprecedented turbulence and suspicion between the two countries, whose uneasy alliance since the September 11, 2001 attacks has centered around the fight against Islamist militants operating from Pakistan.
The series of bilateral crises in the past 18 months has included Pakistan's arrest of a CIA contractor in early 2011; the top-secret U.S. raid that killed Osama bin Laden just 50 km (30 miles) from Islamabad a few months later; and Pakistanis' outcry over ongoing U.S. drone strikes in western tribal areas.
The event that plunged those ties into deep freeze was the U.S. air assault in November 2011 that killed 24 Pakistani soldiers along Pakistan's border with Afghanistan.
For months afterwards, Pakistan refused visits by senior U.S. officials; only in the last few weeks have visits resumed.
Munter's tenure has also coincided in a shift in U.S. policy toward Pakistan, as hopes in the early days of the Obama administration for a more robust U.S.-Pakistan engagement, including high-level visits and massive civil and military aid, have slowly been overtaken by mutual mistrust and frustration.
Today, many officials in Washington appear to have resigned themselves to what they call a "transactional" relationship, limited largely to a degree of cooperation on counter-terrorism and some U.S. military and civilian assistance.
The expected nomination of Olson, who served as U.S. ambassador to the United Arab Emirates until 2011, does not appear to represent a change to U.S. policy toward Pakistan, but it could enable a fresh start after a dark period.
"When two governments understand one another as poorly as those in Washington and Islamabad do, the interpretive abilities of a good ambassador become paramount," said Ronald Neumann, a former U.S. ambassador to Afghanistan, Bahrain and Algeria, and the current president of the American Academy of Diplomacy.
TYPICAL POSTING TWO YEARS
A U.S. official, speaking on condition of anonymity, said Munter informed his staff on Monday that he had decided not to extend his tenure in Islamabad for a third year.
"Ambassadors serve at the pleasure of the president, but given the grueling pace and difficult working conditions, the expectation for hardship posts like Afghanistan, Iraq, Pakistan is that ambassadors would usually serve for two years," another U.S. official said. "Some have served longer terms; some have served shorter terms."
A productive relationship with Pakistan over the next two years will be crucial if the Obama administration is to withdraw most of its troops from neighboring Afghanistan as planned without letting the country slide into civil war.
In a speech last fall, Olson warned of the perils the United States would face if it walked away from central and South Asia when the West's war in Afghanistan winds down.
After the Soviet withdrawal in 1989, "the United States rapidly disengaged from Afghanistan and Pakistan in a series of decisions for which we would ultimately pay a significant price," Olson said.
A central theme - and stumbling block - in U.S.-Pakistan ties has been U.S. belief that Pakistan has failed to act against militants attacking U.S. troops in Afghanistan.
Some U.S. officials have openly accused Pakistan of direct support for certain militants allied with the Taliban.
The switch also comes at a sensitive moment in Pakistan, after the head of its weak civilian government was convicted of contempt of court and its parliament demanded an end to drone strikes and a U.S. apology for the soldiers' deaths.
Munter was an ally of Richard Holbrooke, Obama's larger-than-life envoy to the region before he died in 2010. Munter came to Islamabad from Baghdad and also served as U.S. ambassador to Belgrade.
(Additional reporting by Arshad Mohammed; editing by Warren Strobel and Cynthia Osterman)