President Reagan's talks this week with Southeast Asian allies -- especially Indonesia -- are expected to help Washington decide what to do next about improving ties with Vietnam. Those ties are currently strained over the slow progress on the issue of American soldiers unaccounted for since the Vietnam war. They could become warmer or cooler, depending on how Mr. Reagan reads the mood of the United States' partners in the Association of Southeast Asian Nations (ASEAN) this week on the paradise isle of Bali.
Indonesia has been courting Hanoi, much to the displeasure of fellow-ASEAN member Thailand, which faces the threat of some 160,000 Vietnamese troops along its border with Cambodia. That's why Reagan's private meeting with Indonesian President Suharto tomorrow, besides his joint talks with the region's six foreign ministers, could reset the pace of negotiations with Hanoi.
``If we are going to have improved relations with Vietnam,'' a top US official says, ``then Hanoi has to get good relations with ASEAN.''
A shift in ASEAN's stance toward Hanoi would be just a small step toward the long-term US strategic goal of encouraging Vietnam to drop its alliance with Moscow and deny the Soviets the warm-water ports and airstrips left behind by the US in Vietnam. To clear the way for better ties, Hanoi has promised to solve the missing-in-action issue by mid-1987, although its occupation of Cambodia and Laos remains a major barrier.
If ASEAN slowly backs Indonesia's moves toward improved ties with Hanoi, the American official says, ``then Japan and the US will follow -- and that will box in China to go along. . . . That's the American goal for now.''
China, in its attempt to gain better trade and relations with noncommunist nations and neighbors, would have difficulty in continuing to pressure Vietnam into its historical subservience to China if the US, Japan, and ASEAN improved ties with Hanoi, ASEAN and US officials say.
The traditional enmity between China and Vietnam (including China's periodic shelling across their mutual border) is Hanoi's main publicly stated reason for continuing its occupation of Cambodia. Vietnamese troops invaded Cambodia in 1979, ousting the Peking-backed Khmer Rouge.
For Indonesia to push ASEAN any further toward talks with Hanoi requires, to some degree, a green light from the US, which in turn has to guarantee Thailand of adequate security against any possible Vietnamese invasion. (The US began plans this month to provide Thailand with a war-reserve weapons stockpile.)
So far, overtures to Hanoi by Indonesian Foreign Minister Mochtar Kusumaatmadja have had little backing from the US. Still, Indonesia pushes ahead. A year ago, the Indonesian commander in chief, Gen. L. B. Murdani, offered military cooperation to Vietnam.
But Indonesia seeks Reagan's blessing this week, not only for the sake of better regional ties with the US's former enemy, but because Mr. Suharto's government envisions Indonesia as becoming the major power in the region.
As the world's fifth most populous nation, with more than 160 million people, Indonesia has been flexing its diplomatic muscles beyond the confines of ASEAN. Under the 20-year rule of military-backed President Suharto, it has achieved steady economic development at the cost of an open, Western-style political system.
In addition, Indonesia believes it has recovered from the diplomatic isolation caused by its 1975 takeover of the former Portuguese territory of East Timor, despite continued guerrilla fighting there.
Like its ASEAN allies, however, Indonesia remains wary of any diplomatic shifts that might allow China to wield more influence in the region (once called the ``South China Seas'' region), especially through the overseas Chinese minorities in ASEAN countries. Indonesia blames China for the 1965 attempt of the Indonesian Communist Party to take over the country.
US policy toward Indonesia is cool but comfortable. The State Department, in its 1985 human rights reports, said: ``Indonesia's government has its authority concentrated in a small group of active and retired officers and civilian technocrats. President Suharto is the decisive political figure.''
At the very least, Reagan's trip to Bali is seen as making amends toward Indonesia, which was deeply offended by the last-minute cancellation of a Reagan trip to Indonesia and the region in November 1983 -- although the trip was dropped to avoid the embarrassment of a US embrace of Philippine President Ferdinand Marcos after the August assassination of opposition leader Benigno Aquino Jr.
Reagan's endorsement of Indonesian talks with Hanoi could depend on how close the US wants its ties with Suharto. Like Mr. Marcos, he came to power in 1965 and has kept the far-flung archipelago in a tight grip. And as Marcos did, Suharto faces a tough question of who will succeed him. The dramatic rise of democratic forces in the Philippines last February and the ouster of Marcos -- with only last-minute US help -- provide an all-too-current lesson for the US in its dealings with Indonesia.
As with Marcos, much may depend on the personal relationship between Suharto and Reagan. ASEAN: Asia's counterbalance to Vietnam
The six-member Association of Southeast Asian Nations -- made up of Indonesia, Thailand, Singapore, Malaysia, the Philippines, and Brunei -- was established in Bangkok on Aug. 9, 1967. The association was formed to set the framework for regional cooperation and gained political prominence as it tried to fill the vacuum left by the US withdrawal from Vietnam in 1975.
Since the Vietnamese invasion of Cambodia in 1979, Vietnam has been a chief target of ASEAN's political activity. ASEAN hangs together today mainly to resist Vietnam's occupation of Cambodia by backing Thailand-based guerrillas of the Coalition Government of Democratic Kampuchea (Cambodia). The CGDK is made up of three anti-Hanoi Cambodian resistance groups: the communist Khmer Rouge and two noncommunist factions, one of which is led by Cambodia's Prince Norodom Sihanouk.
Although as a political entity the association has had considerable success, it has not gone far with its efforts at economic cooperation. Trade within ASEAN has actually declined since its founding, and the notable economic success of some member states in recent years has been accomplished by the individual countries.
ASEAN was instrumental in the UN rejection of the credentials of the Vietnam-backed government in Phnom Penh. The organization also had considerable influence on the outcome of the July 1981 UN International Conference on Kampuchea. The 83 countries in attendance adopted a resolution calling for a cease-fire and withdrawal of all foreign troops with monitoring by a UN peacekeeping force; urging Hanoi to join the talks (Vietnam, the Soviet Union, and other Soviet allies boycotted the parley); and establishing a seven-country committee to open talks with all involved parties.
Structure: ASEAN heads of government are the group's highest authority, but annual meetings of the member states' foreign ministers set general policy. A standing committee provides continuous supervision of ASEAN activities.