Iran's leaders are rebuilding links with the rest of the world while the country moves slowly toward ending the war with Iraq - and perhaps ending the long ordeal of Western hostages in Lebanon.

The leaders face opposition from hardliners who fear that ending Iran's self-imposed isolation as it struggles to rebuild after eight years of war will undermine the Islamic revolution."Iran is now at a crossroads," one Western analyst commented. "It must either become more inward-looking or start looking outward.

"The signs right now are that those advocating more openness hold sway. But the next few months will be crucial either way."

Parliament Speaker Hashemi Rafsanjani and Foreign Minister Ali Akbar Velayati launched Iran's bridge-building campaign a year ago, six months before Tehran accepted a United Nations-sponsored cease-fire July 18 after a string of disastrous defeats.

The Iranians fought the war virtually without allies, while Iraq had the Soviet Union, France and most of the Arab world behind it.

Rafsanjani and his supporters realized that Iran's "No West, No East" strategy was counterproductive.

He declared Aug. 21: "Our postwar foreign policy will be more open than our policy during the war. We must take this opportunity to explain our aims and talk with the people of the world."

Reining in Iran's unruly Lebanese surrogates, the fundamentalist Hezbollah, or Party of God, and other Iranian-backed terrorist factions is a key component of his strategy.

He underlined that in a recent Tehran Radio broadcast in which he stressed that Iran now "is not thinking of exporting our revolution through direct intervention or by force. The policy of force is not a successful policy."

Groups linked to Hezbollah, the spearhead of the Islamic revolution in Lebanon, are believed to hold most of the 17 foreigners, nine of them Americans, still missing in Lebanon.

The longest held hostage is American Terry Anderson, chief Middle East correspondent for The Associated Press. He was kidnapped March 16, 1985.

Rafsanjani, considered the most powerful figure in Iran after Ayatollah Ruhollah Khomeini, has told Britain that Iran will help free British nationals held in Lebanon, including Church of England envoy Terry Waite, in return for normalizing relations.

On Friday, Britain announced it would resume full relations with Iran, frozen last year after an Iranian diplomat was arrested for shoplifting and a British diplomat was kidnapped and beaten in Tehran.

The Iranians have ranked Britain second only to the United States as its main enemy in the West.

Earlier last week, it was announced that Kuwait and Iran were restoring full diplomatic relations.