International Monetary Fund Managing Director Jacques De Larosiere yesterday bluntly challenged the United States--and other nations running big budget deficits--to produce "a credible plan" for curbing the flow of red ink to bring down high interest rates.

In his annual address to the joint meeting of the IMF and World Bank, de Larosiere joined President Reagan in appealing to Congress to pass the $8.4 billion appropriation bill for his agency.

But he added that the need for lowering budget deficits "is perhaps the most important policy element that remains to be set in place."

By implication, de Larosiere sided with the chairman of the Council of Economic Advisers, Martin S. Feldstein, and against Treasury Secretary Donald T. Regan in the debate over the relationship of budget deficits and interest rates.

De Larosiere said that, if monetary restraint accompanies continued deficits, it would keep upward pressure on interest rates, jeopardizing prospects for a balanced recovery.

"On the other hand, the persistence of large budget deficits in conjunction with a more accommodative monetary policy would have even graver consequences through reviving inflation and undermining growth," he added. "There is, unquestionably, a close association over the medium term between inflation and interest rates."

Regan, who argues that there is no historic relationship between deficits and interest rates, told the Interim Committee on Sunday that, if the United States raised taxes to reduce the deficit, it might abort the recovery.

He was privately chided during the rich nations' Group of 10 session on Saturday by French Finance Minister Jacques Delors, who accused Regan of slipping back into Keynesian logic. Delors and other Europeans continued to insist in their speeches to the annual meeting that high interest rates threaten to choke off the economic recovery.

De Larosiere said the IMF economic staff now estimates that the gross national product in the industrial world is expanding at an annual rate of between 3 and 4 percent, and will continue "at broadly the same pace into next year."

The recovery also has had a beneficial effect on commodity prices and the growth of world trade, he said. Commodity prices had risen about 14 percent by August from the depressed levels at the end of 1982, a development aiding the cash flow of Third World countries.

World trade, which actually had contracted by 2 1/2 percent in real terms in 1982, will increase moderately this year, and do even better in 1984, he predicted.

Moreover, by making significant adjustment to their strained financial condition, the Third World debtor countries would have a trade deficit of only $40 billion in 1983, a "massive reduction" from a trade deficit twice that size two years ago, de Larosiere reported.

Moreover, he contended that this improvement had not been made at the expense of constricted growth as a response to IMF austerity programs. By following IMF guidance, the borrowing nations were able to sustain their imports, de Larosiere argued.

As a success story, he cited the "remarkable progress" made by Mexico after it made the hard decision to follow the IMF program. He said that imports have been picking up, following a 50 percent slash (in dollar terms) in the second half of 1982 from 1981 levels.

Taking into account all 31 countries that entered into new IMF programs in 1982, he said that imports would rise by 8 percent in 1984 after falling by 21 percent in the year prior to making IMF deals.

As to IMF resources, de Larosiere said that the "commitment gap"--IMF promises to lend in excess of resources--is now measured at 4.1 billion special drawing rights (about $4.3 billion) and would rise to 6 billion SDRs ($6.3 billion) at the end of the year.

The steps he took two weeks ago to suspend new loan negotiations will stay in place until the fund's treasury is replenished by the quota increase and the 6 billion SDRs ($6.3 billion) he is trying to borrow from European central banks and Saudi Arabia.