The grand plan to preserve white power in South Africa by establishing 10 black "homelands" has failed after 25 years of trying. So the plan is being cleaned up and modernized -- not to share power but to keep it.

Some of the old apartheid plan's harshest features are being dropped as "outdated" and "unnecessary" -- mainly Jim Crow laws that pander to white racial prejudices while doing little to maintain political power. The government is attempting to come to grips with the changes that a quarter-century of industrial revolution have brought, but the core elements that entrench white minority rule are to remain.

"Apartheid is dead," say Pretoria's sympathizers, pleading for a critical world to be more sympathetic and give the government of President Pieter W. Botha time to carry out its reforms in a way that will bring its deeply conservative white constituency along with it.

"Neoapartheid is alive and well," say the administration's critics, urging the world not to be fooled by token changes and to step up the pressure until the white minority regime lifts its ban on the popular black political movements, releases their leaders from prison and negotiates a new constitution.

What has changed everything in the last 25 years is South Africa's industrial revolution, which pulled blacks out of the homelands and into the cities. Analysis of government statements for the last year show the administration acknowledging that revolution and accepting that the black tide to the cities cannot be reversed. The Botha government now appears reconciled to the fact that South Africa will always have a black majority.

That means the old apartheid plan has to be redrawn to account for blacks living permanently in cities and taking part in the industrial economy. At the same time the new policy has to preserve separate political systems in order to guarantee white "self-determination." The refurbished policy is being wrapped in new language that emphasizes what is being changed while it skims over what is not with ambiguous phrases like "power-sharing" and "a single education policy," which can be interpreted one way to foreign critics and another to anxious folk at home.

The policy is being repackaged and strongly advertised in an attempt to improve South Africa's pariah image abroad. President Botha's decision this week to lift the state of emergency in 30 towns and cities where it still applies falls into the same category -- it sounds good but the essentials remain. While the state of emergency is lifted, security laws will be toughened up "to enable the authorities to deal with continued incidents of unrest without subjecting the population to the inconvenience of a state of emergency."

The changes are drawing widely differing responses from different audiences, but, left and right, many agree that the government has begun a chain reaction that it will not be able to control.

"Botha is creating a dynamic that is cutting across everything he is trying to do," says Colin W. Eglin, a veteran member of parliament who was appointed last week to head the liberal Progressive Federal Party when its young Afrikaner leader, Frederik van Zyl Slabbert, resigned in frustration at what he regarded as the insincerity of the government's reformist declarations.

"Between separation and integration there is no permanency, only a slippery slope to black domination," says Louis Stofberg, a member of the far-right Herstigte National Party, who won his party's first parliamentary seat last October in a special election that showed growing Afrikaner reaction against Botha's reforms.

The old grand plan was devised in the early 1960s by former prime minister Hendrik F. Verwoerd, a Dutch-born psychology professor who turned the crude concept of baasskap, or white mastery, into an elaborate ideology of "separate freedoms" and who dominated the ruling National Party with the power of a national soothsayer until he was assassinated by a deranged parliamentary messenger in 1965.

Verwoerd's answer to the Afrikaners' historic dilemma of how to keep their own homeland while heavily outnumbered was the "homelands" concept. As the homelands -- only 13 percent of the nation's land -- were developed, they would become so desirable to blacks that the drift to the cities would halt, then reverse.

For some reason that he never explained, Verwoerd chose 1978 as the magical year when this black tide would turn. Thereafter, the black townships in urban areas would wither away, rather in the manner of the nation-state in original Marxist theory.

Eventually they would be no more than temporary camps for a few migrant workers who would come into the cities from the "homelands" for limited periods, leaving their families behind them. South Africa would then be a white country with an Afrikaner majority.

In line with this doctrine, residents of the black townships were not allowed to own their homes or the land on which they were built, but had to rent them from the state. There could be no businesses except those providing "daily essentials," such as food and fuel. Even those businesses had to renew their licenses annually. Blacks were not allowed to enter into partnerships or form companies. The result was that a huge township like Soweto, a city with more than a million inhabitants, developed without any supermarkets, department stores or downtown shopping area.

Blacks were forbidden to be in any city without a permanent job and could be arrested if they did not produce a passbook proving this on demand. They were not allowed to do skilled work in the expanding industrial economy -- these jobs were reserved by law for whites. There were no technical training schools for blacks outside the homelands and blacks were not allowed to form or join labor unions. A law called the Physical Planning Act fixed the number of blacks industrialists could employ -- they had to ask permission for any increase to cope with expansion.

To businessmen who complained that the system was stunting growth, Verwoerd had a blunt reply: "If South Africa must choose between being poor and white or rich and multiracial, it will choose to be white."

Much of this has now been swept away by the Botha reforms. Despite 18 million pass-law arrests and the forced removal of 3.5 million people, 1978 saw the flood to the cities running stronger than ever. At the same time, many Afrikaners, traditionally country folk, have moved to the cities and into businesses where they have seen the need for a skilled and stable work force that the old migrant labor system cannot provide.

Taking Israel as their model, the military chiefs decided that the way for white-ruled South Africa to survive in a hostile environment was to assert its military and economic strength as a "regional superpower." The chiefs -- always close to Botha, who was defense minister for 14 years -- realized too that growing black unemployment posed a security risk as population grew faster than the number of jobs.

To stay white, South Africa would therefore have to become rich, which meant standing Verwoerd's poor-and-white dictum on its head.

The reforms were evaluated over several years by a secret society of Afrikaner elitists called the Broederbond, which functions as a political think tank.

First to go were the job reservation laws, the Physical Planning Act and the restrictions on black unionization. Black labor unions were permitted in 1979, and according to official estimates there are now nearly 900,000 members in 87 unions, representing 18 percent of the black industrial labor force.

Then urban blacks were allowed 99-year leasehold rights in the townships; now Botha has announced that they can have freehold rights as well. Some of the restrictions on black entrepreneurship have been lifted and Botha has started a state-financed Small Business Development Bank to help blacks launch businesses.

This is gradually transforming the bleak, monochromatic townships. Some smart middle-class suburbs and a few shopping centers are beginning to appear amid the endless rows of little matchbox houses.

In recent weeks downtown Johannesburg and Durban, from which thousands of black and Asian traders have been expelled under the apartheid laws over the past 26 years, were declared "free trade areas" open to businessmen of all races. Other major cities will follow soon.

When the failure to turn the black tide started becoming apparent, there was an attempt to deal with the crisis this posed for the ideology by stripping the blacks of their citizenship. As their homelands were granted nominal independence; they would be citizens of the new state, regardless of where they lived. Eventually there were to be no more black South Africans, only resident foreigners living in an Afrikan-led country with Colored (mixed-race) and Asian citizens among the white majority.

Botha announced on Jan. 31 that this, too, was being scrapped. "We accept an undivided Republic of South Africa . . . with one citizenship for all South Africans," he said, adding that South African citizenship would be restored to people who lost it when the first four homelands became independent.

Botha has not abandoned the homelands, merely the belief that they can solve the Afrikaner dilemma. His policy now aims at accepting blacks in the cities and their advancement in industry, while preserving racially separate political institutions within the "undivided South Africa."

Most important of all, Botha announced in a series of signed advertisements earlier this month that the pass system would be scrapped by July 1. It is to be replaced by what he calls "orderly urbanization," a form of controlled squatting in demarcated areas outside the white cities and black townships.

Integrated sports are now permitted and soccer, the passion of the black population, draws crowds of 100,000 to Ellis Park Stadium in the heart of white Johannesburg. Blacks may use theaters, some cinemas and, in a form of economic segregation, the more expensive hotels and restaurants. Botha last year revoked laws prohibiting sex and marriage across the color line, which blacks regarded as the supreme expression of a white herrenvolk, or master-race, attitude.

But the laws legally classifying all South Africans according to race and compelling them to live in separate group areas, which most political analysts here regard as the cornerstones of apartheid, are to stay.

So is segregation in state schools. When Botha speaks of "a single education policy" he means only that there is to be a single government ministry coordinating the work of separate ethnic departments, not that the schools themselves are to be integrated.

In line with the decision to go for economic growth, the government is trying hard to upgrade black education -- but within a segregated framework.

Since Botha came to power in 1977, expenditure on black education has risen from the equivalent of $70 million a year to more than $350 million. The number of black pupils in school has risen from just over 3 million to nearly 6 million. A new school building is completed each day and providing technical schools is a priority. But the government still spends six times more on each white child in school than each black child, and the teacher-pupil ratio for whites is 1 to 18.2 compared with 1 to 42.7 for blacks.

"If the white's way of life is affected, if the right to educate his child as he prefers, if his language is implicated, if his residential areas, these things, if the riches he has gathered for himself, if this is taken away from him, then I must tell you we are looking for trouble," Botha told former oppostion leader Slabbert. He added: "I cannot agree with you that the whites must surrender the right to self-determination."

That is the bottom line. What was once a policy of racial partition, with the whites getting the lion's share, is being transformed into a kind of federation of legally defined racial groups that the white group will dominate.

This is done by dealing with people as groups, not individuals, to prevent white political power from being overwhelmed by numbers. At the national level, the whites, Coloreds and Asians have each been given a parliamentary chamber with authority over its "own affairs." The white chamber dominates the other two and so elects the president, who has autocratic powers and picks his own cabinet mostly from MPs of his own party.

Blacks are not to be given a parliamentary chamber, because their superior numbers would dominate the white chamber. This problem stymied the administration for several years, but now Botha has announced that he intends to establish a national statutory council on which members of the government, black community leaders and representatives of the nonindependent homelands will sit under his chairmanship.

The president will also appoint the executive committees of the provinces. Representation to regional councils will be based on taxes paid, which means whites will dominate.

The problem, according to Hermann Giliomee, a respected Afrikaner political analyst, is that "the government will have to draw in some credible black leaders to give it legitimacy. That means it will have to start making political concessions to make the system more acceptable to blacks."

The administration will fail to persuade even the moderate Zulu leader, Chief Gatsha Buthelezi, to join negotiations if it begins by saying, "these are the structures and this is the bottom line, now come and talk," Giliomee says.

Opposition leader Eglin says: "The combination of Botha loosening the ideological cement in which Verwoerd had cast society, and the socioeconomic direction in which South Africa is moving and to which Botha is adapting, is creating a momentum that is dragging the government along with it."

Andre du Toit, a political scientist at the prestigious Afrikaner University of Stellenbosch, notes that there has already been a shift in what he calls the "balance of political forces" since Botha came to power.

"A decade ago the National Party was the only nationwide political organization of any substance," du Toit notes. "Now the National Party has been split by Botha's reforms and a whole range of other groups are thrusting forward -- black political movements, labor unions, even the business community."

But he added: "The model is still white control, and it's not about to change."