BEIJING -- The Xinxing Corp.'s colorful catalog offers dozens of items for both Third-World warriors and wealthy Westerners: camouflage gear and tuxedos, high-top boots and high-gloss loafers, mess kits and briefcases, medical supplies and anti-dandruff shampoos, bulldozers and station wagons.

The goods are all available for export. Profits from their sale supplement the Chinese military's meager official budget -- Xinxing is one of the People's Liberation Army's (PLA) largest corporations.

Xinxing and other Chinese state-owned exporters to the United States are specific targets in the Clinton administration's frantic search for a way to punish China for its human-rights abuses, while avoiding the disastrous impact of total withdrawal of its most-favored-nation (MFN) trade status with the United States.

Ending MFN would raise tariffs on most Chinese goods so high they couldn't be sold in the United States, setting off a trade war with the world's fastest-growing economy -- a war that would hurt American consumers, workers and companies as well as China.

But China at best has been slow to meet U.S. demands on human rights, even with the recent releases of some prominent dissidents. With less than two weeks before the June 3 deadline for the MFN decision, Mr. Clinton appears to be searching for a limited step that would allow him to save face while beginning to undo the link between trade and human rights -- a link that's backfired for the United States.

And targeting the exports of state-owned or even just PLA-owned companies for MFN withdrawal is high on the list of the limited moves under consideration.

Proponents of unconditional renewal of China's MFN status -- virtually the entire U.S. business community -- say limited withdrawal of MFN in this way would sour Sino- American relations just the same as total MFN withdrawal. It also might be a nightmare to enforce.

But many critics of China's human-rights record have been pushing hard for limited sanctions of some sort, particularly the move against Chinese military products.

"Our objective is to get a sanction that's real, not cosmetic," Jeffrey Fielder, secretary-treasurer of the AFL-CIO's food and allied service unions, said in a telephone interview from Washington last week. "The PLA are the gunmen who shot up the folks in Tiananmen Square, and the U.S. government is unwittingly subsidizing them by letting them do business freely in the U.S."

There's no question such sanctions would come at a bad time for China's more than 100,000 large and medium-sized state enterprises. Two-thirds don't make money; many soon must begin massive layoffs or go under. Many military factories are in the same bad shape.

But targeting Chinese state or PLA enterprises may hurt the United States as much or more than China, even though China sells to the United States almost four times more than it buys from it.

That's because state firms, including PLA companies, were the main buyers of last year's $8.8 billion of U.S. exports to China, largely aircraft, computers, telecommunications gear, power equipment and wheat.

China's state sector might have accounted for just a third of its $33 billion of exports to the Unites States last year. The top Chinese exports -- toys, shoes, textiles and electronics -- came largely from rural and foreign-funded enterprises.

Moreover, targeting PLA factories runs directly counter to a U.S. Defense Department initiative last fall to improve ties with the PLA. The theory is that the military will play a leading role in the political struggle likely to follow the death of ailing patriarch Deng Xiaoping.

Ironically, a key part of this initiative is the formation of a joint commission on military conversion, a move premised on the notion that China has a lot to teach the United States about converting defense industries to civilian production.

At the second-rate hotel in western Beijing that serves as Xinxing's headquarters, company officials are proud of the rapidly increasing quality and diversity of their products, about 80 percent of which are for civilian use.

With 140,000 workers at more than 100 factories throughout China, the 5-year-old conglomerate operates directly under the PLA's General Logistics Department; its officials are former army officers. They say they'd hate to lose the American market, but it wouldn't be a disaster for them.

"We do want to expand our exports to America, but right now they're really very small," said Wu Haiqing, director of the office of Xinxing's president. "

Xinxing's exports totaled $100 million last year, Mr. Wu says, with only about $5 million going to the Unites States. By contrast, he says, the company bought more than $10 million of U.S. goods.

But U.S. import records obtained by the AFL-CIO's Mr. Fielder and sent to The Sun show Xinxing may be more vulnerable to the loss of the U.S. market than Mr. Wu admits.

Range of shipments

Mr. Wu says in recent years Xinxing has shipped only leather shoes and shrimp to America. But the U.S. records show an impressive range of other shipments from 1991 through 1993: mens' suits, stuffed toys, bauxite, antique wooden furniture, latex gloves, flour sacks, hand puppets, denim jeans, steel washers, violins and rain suits.

Xinxing's Mr. Wu called the U.S. import records "strange," claiming that his company's factories don't even produce many of these products. But the company could have been the sales agent for other PLA or nonmilitary firms.

And Mr. Fielder believes this exemplifies how many Chinese state and PLA enterprises -- by trading through Hong Kong or offshore companies and selling products made by others -- may be more deeply reliant on exporting to the United States than commonly believed.

PLA products are in most major American chain stores, Mr. Fielder says. For example, the U.S. records show that about 11 million metric tons of men's denim jeans arrived at the port of Oakland, Calif., on Feb. 2, 1993, bound for "K-Mart Apparel" in Troy, Mich.

Rifles exported

The most notorious PLA export to the United States has been tens of thousands of assault rifles, mainly AK-47s and the MAK-90s. They've sometimes been illegally outfitted with machine-gun receivers or threaded muzzles in violation of federal laws on the import of sporting guns.

Many such assault weapons would be banned under crime bills passed by the House and Senate; the differences in the bills still have to be resolved by a House-Senate conference committee.

Mr. Fiedler claims that China already has exported to the United States $100 million worth of assault rifles -- primarily through two top PLA companies, Norinco and Poly Technologies, and a third firm, Jingan, run by the quasi-military People's Armed Police.

Identifying the full extent of Chinese military exports to the United States or even whether a particular product is from a PLA factory is complicated by the PLA's joint ventures with foreign firms; its overseas holdings; its many cross-cutting ties to nonmilitary Chinese firms; widespread military corruption; and a long history of secrecy here about activities at defense plants.

China is known to have about 1,000 large defense plants and another 30,000 smaller ones, but there's no limit to the PLA's involvement in business. The Chinese military can be viewed as a virtually self-sufficient state within a state or, at the very least, as China's largest and most powerful conglomerate.

TTC The PLA has a hand in palatial joint-venture hotels, makes half of China's motorcycles and buys overseas companies. It makes birth-control devices and buses, operates cargo airlines, runs farms and speculates in foreign currencies.

Among its well-known foreign partners in joint ventures are Boeing, the U.S. airplane giant; and Mercedes, the German automaker, according to official Chinese reports.

Foreigners even can buy stock here in a Chinese glassmaker that is 26 percent owned by a PLA firm. In 1992, that glassmaker in turn bought controlling interest in a Los Angeles glass company.

Military has advantages

At a Hong Kong trade fair two years ago, a top PLA official, Maj. Gen. Huai Guomo, described the military's financial advantages in China: "We have lower labor costs. Interest rates could be lower for bank loans. Transportation costs could be lower because the military is also in the transportation business."

Military business earnings -- not to mention the PLA's arms sales -- are believed to at least double the PLA's formal budget, money that has gone toward recent high-tech arms purchases from Russia. These purchases have markedly extended China's ability to project its power offshore, much to the worry of Southeast Asia.

At Xinxing, Mr. Wu dismisses the belief that the PLA's exports of civilian goods are feeding a Chinese arms buildup.

"It's impossible for us to use our profits for some special weapons," he said. "We're just able to provide the bare necessities for our workers. Our basic goal is to provide for our people to keep up with the rising standard of living in Chinese society."

But AFL-CIO's Mr. Fiedler doesn't buy that. "If the U.S. wants to subsidize the growth of the Chinese military, let the U.S. Congress debate it and, if it passes, then send them a check," he said.

He also doesn't believe that withdrawal of MFN's low tariffs for the products of China's state and PLA companies wouldn't hurt them.

"If they're making the argument that the American market is not important to them and they can make up the difference in Europe," he said, "then I'm quite willing to find out by calling their bluff. Let's just do it and see."