By Walter Pincus
Washington Post Staff Writer
Saturday, June 13, 1998; Page A18

When Chinese officials, trying to explain in 1996 why one of their satellite-bearing rockets had blown up, gave an American review panel a report detailing what had gone wrong, it was the first time they had revealed to outsiders the inner workings of their Long March missiles.

The Chinese report, said John Pike of the Federation of American Scientists, contained "material a spy could only dream of."

According to one CIA expert, U.S. analysts have known "a great deal" about Chinese intercontinental missiles based on information gathered since the mid-1980s, when the missiles were first deployed. But data obtained through deals to launch commercial satellites on Chinese missiles over the past eight years "has provided a new comfort level," the expert said.

Republican critics of the Clinton administration's approach to China have stressed national security risks involved in satellite sales and cooperative launches. But administration and congressional experts point out there have been unpublicized benefits to U.S. intelligence from such relationships since the Bush administration.

"Intelligence in these matters is a two-way street," one Capitol Hill intelligence expert said. "There are definite advantages for our intelligence agencies to be dealing with U.S. satellite technologies with which we are familiar."

The National Security Agency (NSA), which gathers intelligence by intercepting electronic transmissions, gains an advantage when the Chinese military or other officials use communications satellites bought from U.S. companies, according to one former top Pentagon official who now works for a defense contractor.

"We know the frequencies, the orbits and the way to jam it if we ever went to war," this source said.

CIA and White House officials, as well as congressional investigators, refuse to discuss intelligence gains on the record. But a staff member of the Senate Intelligence Committee said benefits to U.S. intelligence agencies would be one factor weighed by the committee during closed-door sessions of its ongoing investigation into the Clinton policy.

A former top intelligence official, experienced in NSA operations, said that eavesdropping on the Chinese military has always been difficult because most of its transmissions are carried over secure telephone lines or buried cables. These lines are not susceptible to interception by U.S. intelligence satellites or ground stations.

If the Chinese begin using U.S. satellites for some of those communications, this former official said, "at least we'd have a chance to collect it."

"What our military wants most is for the Chinese military to use our satellites," another former Pentagon official said.

For instance, if the Chinese send encrypted military messages using the Lockheed Martin ChinaStar communications satellite that was launched two weeks ago, "we will have a better shot at collecting them than if they used a Chinese-made satellite," a former top CIA official said yesterday.

Critics of U.S. policy say that even though the law bars unauthorized transfers of missile technology to the Chinese, there is an intrinsic incentive for American firms to help China improve the reliability of missiles carrying multimillion-dollar U.S. satellites, as is alleged to have occurred following the 1996 crash. Because the Chinese use similar missiles for commercial and military purposes, critics have charged that such improvements could directly harm U.S. security.

Sources said U.S. intelligence agencies also have taken advantage of the launching program. For U.S. intelligence, access to Chinese missile technology through monitoring launches on-site is not "a pot of gold," a congressional expert said. "But it does give us corroborative information."

"The Chinese have never shown a great interest in getting into a long-range missile arms race like the U.S. and former Soviet Union," a senior intelligence official said recently. "They built enough -- about 50 ICBMs -- to serve as a deterrent but most of their money has gone into their conventional forces."

One reason for U.S. confidence about the Chinese ICBM force is that it has remained virtually unchanged since the 1980s, a White House official said. The deployed Chinese ICBMs, about 18 of which are designated to be aimed at the United States, are a version of the Long March launchers used since 1989 to send U.S.-made satellites into space. Both are liquid-fueled and similar to the U.S. Titan ICBM missile that was retired years ago.

"The poor reliability of their early satellite launches raised questions about the reliability of their small missile force," one official said. In that sense, he said, help straightening out those problems could help China's small ICBM force.

Intelligence gains from China have played a role in previous administration dealings with Beijing. In 1989, when the Bush administration was responding to Beijing's crackdown on pro-democracy demonstrators in Tiananmen Square, Chinese scientists were continuing to deliver highly classified tapes from two U.S-built listening posts that helped monitor Soviet nuclear tests.

The Clinton administration, in a sign it wanted a way to protect secret intelligence relationships despite Chinese misdeeds in other areas, got Congress to pass a special amendment to the intelligence authorization bill in 1995. The language gave the president authority to delay imposition of sanctions on a foreign government if he believed such an action would "compromise an ongoing criminal investigation or an intelligence source or method."

China was not mentioned when the amendment passed, but sources said it was a country of concern since Beijing's shipments of missile parts to Pakistan were in the news. The amendment has been reenacted each year since, but administration sources said the president has yet to use it.