Washington — The Reagan administration has declared war on international terrorism. Now it is fighting the political battle over how to define the conflict and which weapons to employ.
Secretary of State George P. Shultz is taking the lead in warning of ''state-sponsored terrorism,'' linking it directly to ''the Soviet Union and its clients.'' His tough words in a speech this week prompted a group of visiting Soviet journalists to cancel their meeting with him.
The administration's recently submitted legislative package on combating terrorism is moving steadily through Congress and will be the first order of business in the Senate Judiciary Committee today. But there are strong reservations about the bills' specifics, which could mean trouble for the White House.
Civil libertarians warn of possible repression, for example, in broadly restricting commercial exchanges with countries designated as sponsors of terrorism. ''This is the part that is least likely to pass,'' says a source with the Senate subcommittee on terrorism, who notes that some conservatives as well as liberals are troubled by this provision.
Other less controversial parts of the administration's antiterrorism legislative package would increase the reward for helping identify potential terrorists and bring US law in line with international statutes on hostage taking and aircraft hijacking.
Some experts on terrorism, on the other hand, say the administration's legislative effort falls far short of what is really needed.
''I would urge Congress not to pass a thing until a comprehensive package is submitted,'' says Robert Kupperman, a former government expert and author on terrorism. ''My greatest fear is that we do nothing effective and then create a McCarthyesque atmosphere when an incident occurs.''
Despite the continuing controversy, the administration has taken a number of significant steps on its own. It has loosened restrictions on domestic surveillance, organized a crack FBI antiterrorist team, beefed up military hostage-rescue capabilities, and bolstered CIA and other intelligence-agency resources for gathering information on suspected terrorists.
As a result, the number of terrorist incidents in this country has dropped sharply. According to the FBI, the number of such incidents has fallen from about 100 annually in the late 1970s to just five so far this year. Much of this is the result of better training of law-enforcement officials and more cooperation among police agencies, says FBI Director William H. Webster.
''I believe we have a very good handle on terrorism in the United States,'' he told a conference on terrorism this week. ''The intelligence base has dramatically improved in the last few years.''
Attacks on embassies and officials abroad are far more difficult to deal with , however, despite the recent strengthening of security at American embassies.
US officials make it clear that they do not condone assassinations to fight terrorism. But they do speak out strongly for ''preventive or preemptive actions'' to head off terrorist acts. And they acknowledge that this is more a matter of determination and executive decision than rhetoric and new laws.
''When you talk about terrorism, there is no panacea,'' White House counselor and Attorney General-designate Edwin Meese III said Tuesday. ''We have the laws, the agencies, the processes already in place, provided we adopt them to terrorism and have the will.''
This matter of will necessarily involves other countries and sharp differences of opinion over the definition of terrorism and how best to address it.
''Terrorism is like apple pie,'' says Michael Pilgrim of Defense Systems Inc. , a consultant to the Pentagon and US intelligence agencies on terrorism. ''Everybody's agin' it, but what are you going to do about it? That's the problem.''
The US would like its friends abroad to take a tougher stand, including economic sanctions, against countries that sponsor or harbor terrorists. But agreement will not be easily won. In London this month, the seven summit nations issued a bland statement that ''viewed with serious concern'' the problem of terrorism.
''Too often, countries are inhibited by fear of losing commercial opportunities or fear of provoking the bully,'' Secretary Shultz complained this week.
Former Israeli Prime Minister Yitzhak Rabin suggests a new international organization, and others say the UN is the best forum for such efforts. But conservatives are very wary of such organizations, where substantive efforts might bog down over assertions that one man's terrorist is another man's freedom fighter.
''That's the equivalent of appointing the poacher to be the gamekeeper,'' says Yale University law Prof. Eugene V. Rostow.
And there will always remain the difficult question of how far a democracy can go in fighting terrorism.
''Maintenance of democratic processes of government and the rule of law,'' says Mr. Meese, ''are paramount.''
''In respecting these freedoms, it may be impossible to eliminate terrorism completely,'' observes FBI Director Webster. ''There is no easy solution short of the total repression the terrorist would invite us to choose.''
Politically, there are pluses and minuses for the administration on the issue. The mining of Nicaraguan harbors by CIA agents is seen by some critics as a form of terrorism itself, as is US support of anti-Sandinista guerrillas. Officials are also having to defend the shipment of portable antiaircraft missiles to Arab countries and a hoped-for nuclear pact with China, which some people feel could increase the possibility that Pakistan will build an ''Islamic bomb.''
On the other hand, there is much support among the American Jewish community for a strong US stand against terrorism. The Reagan administration was well represented this week at an international conference on terrorism in Washington sponsored by the Jerusalem-based Jonathan Institute. The institute is named for the Israeli commando who led and was killed in the 1976 raid at Entebbe airport in Uganda, which freed hostages held by hijackers.