CRISIS IN THE PERSIAN GULF : Iraq Reviving Atomic Arms, Report Says : Military: It also turns out more than 1,000 tons of poison gas a year, U.S. researchers find.

Iraq not only has become a major poison gas producer but also has revived efforts to make atomic weapons, plans that were earlier thwarted by Israel’s 1981 bombing of a nuclear reactor, a report said.

President Saddam Hussein’s government each year turns out more than 1,000 tons of chemical warfare agents, including blister-causing mustard gas and nerve gas, according to “Sword of the Arabs,” a survey of Iraqi weaponry soon to be issued by the Washington Institute for Near East Policy, a private research organization.

Sustained production at that level would give Iraq the world’s largest chemical weapons stockpile if the United States and Soviet Union carry out obligations of a treaty they signed last June to reduce their stocks to 5,000 tons by the year 2002. Current U.S. stockpiles are estimated at 30,000 tons, while the Soviets have an estimated 50,000.

Iraq also has an active program to make germ weapons even though it has signed but not ratified a 1972 treaty prohibiting development or possession of biological weapons, said the report, obtained by the Associated Press.

After Israel bombed Iraq’s Osiraq reactor in 1981, the Iraqi nuclear weapons project remained dormant until 1987, when Baghdad turned to the gas centrifuge method of enriching uranium fuel, the study said.

This method could provide the ability to produce nuclear weapons in 5 to 10 years depending on the amount of equipment and technology Iraq continues to draw from abroad, it added.

Long before that, however, Iraq could make one or two small, low-yield atomic bombs using 12.5 kilograms (27.5 pounds) of French-supplied uranium in its possession, said Michael Eisenstadt, author of the report.

That uranium, however, is subject to international inspection, and its diversion to weapons would be a formal breach of the Non-Proliferation Treaty signed by Iraq, provoking international censure. Eisenstadt said Iraq is unlikely at this time to make the smaller bombs.

The gas centrifuge method, used by Pakistan and Brazil, is easy to disperse and conceal and “might enable Iraq to clandestinely develop a nuclear weapons production capability while formally preserving its credentials as a signatory of the (treaty),” he said.

Eisenstadt predicted that Iraq will stockpile chemical “and possibly biological weapons for the foreseeable future,” and he said that Iraq in the near future is expected to produce chemical missile warheads, “vastly increasing the lethality of its strategic forces.”

He noted that Soviet, Chinese, West German, Austrian, Italian, Argentine, Egyptian and Swiss technology was used in Iraqi missile development.

Development of strike systems capable of reaching Israel “has led to the emergence of an uneasy deterrent relationship between Iraq and Israel,” he said. “Israel now has to consider that a preventive strike against Iraq could prompt retaliation and produce unacceptable losses. Iraq’s strategic deterrent thus produces a protective umbrella for its nuclear weapons program.”