1,000 Americans Left Behind Called Hostages : Baghdad policy: 600 to 700 are in Kuwait and the rest in Iraq. 93 are in custody and 69 are seriously ill.

About 1,000 Americans, including at least 69 who need immediate medical attention, remain trapped in Iraq and Kuwait and now must be considered hostages, the Bush Administration announced Monday.

State Department spokeswoman Margaret Tutwiler said that at least 1,900 Americans and their foreign-born dependents have been evacuated since the Iraqi invasion of Kuwait on Aug. 2.

“All Americans in Iraq and Kuwait . . . are hostages,” said Tutwiler, although she noted that some of the remaining Americans have chosen to stay for family or economic reasons.

Meanwhile, President Bush defended his Persian Gulf policy before a sometimes hostile audience of 150 Arab-American businessmen. He vowed that he would not be “distracted” by Iraqi President Saddam Hussein’s efforts to link the crisis there with the Israeli-Palestinian dispute. And, deflecting suggestions that the embargo on Iraq is depriving children of food, he said that Iraq has refused to permit international relief organizations to send in supervised food shipments.

Tutwiler said 600 to 700 Americans are trapped in Kuwait and 300 to 350 in Iraq, adding that the numbers include men, women and children but that the vast majority presumably are men. Iraq has permitted most women and children to leave but has refused to grant exit visas to most men.

At least 93 Americans have been rounded up by Iraqi authorities, Tutwiler said. She said that the U.S. government does not know where most of these individuals are being held but that the Iraqi government has said it will intern foreigners near potential military targets as “human shields” against possible American bombing.

Iraq has been given a list of 69 Americans who are seriously ill and should be evacuated for humanitarian reasons, Tutwiler said. But she said none of the 69 have been allowed to leave, and one of them was among nine Americans rounded up during the weekend.

“We find it particularly deplorable that the Iraqis not only ignored our request to evacuate Americans with serious medical problems but are now beginning to detain them,” she added

The numbers were kept intentionally imprecise to avoid giving useful information to Iraqi intelligence, Tutwiler said. For instance, she declined to say what percentage of the remaining Americans are staying voluntarily.

“As far as adult male Americans in Kuwait and Iraq, most are in hiding,” she said. “If we release those numbers, we will be providing information to the Iraqis that may impair the ability of these Americans to get out of the country.”

Bush, despite sometimes pointed questions from the Arab-American businessmen, received a standing ovation at the end of his appearance. Nevertheless, the tone of the meeting, in the Executive Office Building next door to the White House, came as a surprise to Administration officials who had carefully selected the audience in an attempt to demonstrate Arab-American support for U.S. policy.

“Over and over again, Saddam Hussein has attempted to make this ‘the Arab world against the United States,’ ” Bush said. “You’ve heard it over and over and over again. And that lie is not going to be perpetuated. It simply is not true. We are joined with many others around the world. Iraq stands alone against the world community.”

However, Bush was asked why Washington refused to consider Hussein’s offer--since apparently withdrawn--to pull out of Kuwait if Israel first withdraws from the West Bank and Gaza Strip.

“First we’ve got to take care of the situation that exists right now, naked aggression of one country against the other,” Bush replied. “That cannot be permitted to stand. I’m not going to be distracted by this.”

Asked why the United States is depriving the children of Iraq of food in the international trade embargo, Bush said he is concerned about the plight of women and children, including refugees stranded in Kuwait, but “I am much less interested in feeding Saddam Hussein’s army.”

Meanwhile, White House Press Secretary Marlin Fitzwater dismissed as empty rhetoric Hussein’s threat to attack Saudi Arabian oil fields and Israel if the United Nations economic embargo of Iraq continues much longer.

“We get a daily diatribe from Saddam,” Fitzwater said. “This is another one.”

At the United Nations in New York, Soviet Foreign Minister Eduard A. Shevardnadze said Hussein’s threat is “inadmissible.”

“Any attacks would unleash a war, and that would mean disaster,” Shevardnadze told reporters. “Statements concerning possible attacks in the gulf area, in the Middle East--which is a region overburdened as it is with weaponry, a very explosive region--are inadmissible.”

Turkish President Turgut Ozal, in Washington preparing to meet today with Bush to discuss the gulf crisis, said Hussein’s threats show that the trade embargo is working. He suggested that Iraq’s military muscle is overrated.

“They (are said to) have a big army, and I don’t believe it,” Ozal said in an interview with Cable News Network. “And they have so many missiles and gas. And even they talk about, not only chemical, but biological or nuclear--but I don’t believe it. It’s too much exaggeration in my opinion.”

In another development, the International Monetary Fund’s top policy-makers approved plans to shore up the economies of nations hard hit by the spiraling price of oil and by the side-effects of the U.N. embargo against Iraq.

The fund’s interim committee promised to increase the flow of funds to Jordan, Egypt, Turkey and other countries that are hard hit by the crisis. It also promised action to lower interest rates. The fund decided to use its regular financing instead of going through the time-consuming process of setting up a special fund, as it did in response to oil price increases in 1973.