Summit Leaders Criticize Tehran : Diplomacy: Prodded by U.S., Group of Seven cites Iran’s export of terrorism, abuse of rights. Nations urge aid for Bosnia but sidestep question of military action.

TOKYO —  Leaders at the seven-nation economic summit criticized Iran today for the first time, after repeated American prodding about Tehran’s exporting of terrorism, accumulation of weapons of mass destruction and abuse of its people’s human rights.

But faced with continuing ethnic warfare in Bosnia-Herzegovina, the summit leaders declared only that they would not accept a Bosnian settlement that “dismembered” the Muslim-ruled state. They did not commit themselves to any new action, and their position represented a softening of the threat made at last year’s summit to use military force to end the fighting.

The criticism of Iran, calling on the Tehran regime to “cease actions contrary to” international “peace and stability,” came in a political declaration issued on the second day of the annual G-7 economic meeting.

The declaration was approved by President Clinton and the leaders of the other member nations--Canada, Britain, Germany, France, Italy and Japan--after what American sources called “overwhelming evidence” of Iran’s culpability had been presented.

But the approval came only after a last-minute delay caused when French President Francois Mitterrand insisted on changing the section of the document dealing with Bosnia.

Last year’s G-7 declaration threatened the use of military power against Serbian militia forces unless they ended their attacks on Bosnian government forces. The Serbs ignored those threats, which the G-7 nations failed to back up.

The draft declaration prepared earlier this week by G-7 foreign ministers dropped all references to military action, calling instead only for humanitarian aid to ease Bosnian suffering and asserting that the Serbs and Croats should not try to dictate terms at talks now under way in Geneva aimed at carving up the Bosnian state.

Asked about the change at a news conference Wednesday, Secretary of State Warren Christopher defended the draft. “It’s a far different situation now than it was last year. The situation is much more difficult to deal with now than it would have been last year or two years ago,” he said.

But when Mitterrand, Clinton and their fellow leaders met Wednesday night over dinner, the G-7’s back-down on Bosnia became a major issue, a senior Clinton Administration official said. Supported by Clinton and German Chancellor Helmut Kohl, Mitterrand insisted that the G-7 maintain some reference to the possible use of military power.

The final communique, officials said, accomplished that goal by referring to U.N. resolutions that have threatened the use of air power to protect Bosnian “safe areas.”

“Stronger measures are not excluded,” the communique said.

At Clinton’s behest, the summit leaders also agreed to add language backing continued sanctions against Serbia so long as it continues to support the Bosnian war.

As for the summit decision to rebuke Iran, officials said it represents a significant victory for the Clinton Administration, which had lobbied hard to include Tehran in the declaration as part of its policy of seeking to contain Iran and Iraq.

The declaration also called for continued pressure on Iraq and Libya, as previous communiques have. But this year’s declaration was the first time the major industrial nations have included Iran.

“Concerned about aspects of Iran’s behavior, we call upon its government to participate constructively in international efforts for peace and stability and to cease actions contrary to these objectives,” the declaration said.

Although the language was oblique in diplomatic fashion to satisfy some worried leaders, Christopher and other American officials hailed it as a major step. “It was a tough battle to get that language in there,” an Administration official said.

In the past, particularly under President George Bush, American foreign policy tilted back and forth between Baghdad and Tehran, depending on which was perceived as representing the more immediate threat to American interests. The result, in the view of Clinton Administration officials, was that both acquired military equipment and technology that eventually proved dangerous.

Now, American officials hope, the G-7 declaration will make it easier to tighten controls on the transfer of military equipment and technology to both countries.

Japan and Germany in the past have resisted proposals criticizing Iran. But a senior State Department official said that, after being presented with overwhelming evidence, “they came around.” Part of the evidence--that Iran has “a very serious program of state-sponsored terrorism that has to be combatted”--was developed by American intelligence and confirmed by European intelligence, the official said.

On another major American priority, the summit declaration called on North Korea not to withdraw from the Nuclear Non-Proliferation Treaty. The United States, concerned about the spread of nuclear weapons worldwide, wants the treaty extended indefinitely. But that has become a sensitive issue since North Korea threatened to pull out of the agreement, raising the threat of a new and potentially hostile nuclear power in Asia.

Japan had been hesitant about endorsing a provision in the summit political declaration calling for indefinite extension of the non-proliferation treaty when it comes up for renewal in 1995 because the Japanese fear that North Korea may develop a nuclear arsenal.

But the summit leaders persuaded Tokyo to support a call for extending the agreement.

The declaration also:

* Urged that the former Soviet republics give high priority to assuring the security of their nuclear weapons and called upon Ukraine to ratify the first Strategic Arms Reduction Treaty.

* Expressed support for democratic and free-market forces in Russia and for Russian President Boris N. Yeltsin.

* Viewed the recent meeting between Yeltsin and President Leonid Kravchuk of Ukraine as a good sign for the Ukrainian reform process and for relations between the two countries.

While the summit resolved disputes over the political declaration, talks on a key economic issue--a “framework agreement” on U.S.-Japanese trade--continued unsettled.

With Clinton’s initial successes here, especially the breakthrough announced earlier on the General Agreement on Tariffs and Trade, White House officials said they no longer feel under pressure to reach agreement with the Japanese on a new framework for a trade agreement before the summit ends.

But several hours later, Treasury Secretary Lloyd Bentsen presented a more positive picture. “We’re still talking, and we’re still looking at each other’s options,” he said. “I’d have to say we’re still in serious negotiations.”

Like other summits, the annual G-7 gathering combines an endless round of formal ceremonies, official sessions, elegant lunches and dinners and--for American Presidents--public appearances designed to project images and messages of leadership to ordinary people.

As a result of all this, plus the less visible but no less real burdens of jet lag that go with transpacific travel, aides said Clinton went to bed tired but ebullient Wednesday night after an 18-hour day.

His exhausting schedule had him making a well-received speech at Waseda University, taking a stroll with his wife, Hillary, through a Tokyo shopping center, attending the opening G-7 sessions--his first--delivering a sound-bite statement extolling the breakthrough on trade negotiations, dominating a dinner discussion of summit leaders and holding a bilateral discussion with Major.