The Carter administration, in a precedent-setting action, has recommended cuts in foreign military aid to Argentina, Ethiopia and Uruguay because those nations violate human rights of their citizens.

The reductions, which were disclosed yesterday by Secretary of State Cyrus R.Vance, take the new administration's overseas human rights policy beyond verbal protests, to tangible action, for the first time. They also dramatize U.S. concerns going well beyond the Soviet bloc to military-run nations that have been allied with Washington.

In the past Congress has urged and occasionally legislated foreign aid cuts on human rights grounds, but the executive branch strongly opposed such action as undiplomatic and counter-productive.

Testifying before the Senate Appropriations Subcommittee on Foreign Operations, Vance cautioned against automatic U.S. aid reductions because of human rights problems of foreign countries. "In each case we must balance a political concern for human rights against economic or security goals," he said.

For example, he explained that no aid cut has been recommended for South Korea "despite the fact that we have great concern about the human rights situation in that country." The reason is the long-standing U.S. security commitment to that strategically located country.

State Department sources said there had been proposals in the administration to make cuts on human rights grounds in the U.S. program for a number of other countries, but that Vance resisted a wider application. At one stage, State Department regional bureaus were asked to nominate the worst human rights offenders in their areas to be considered for aid reductions, the sources said.

The reductions in military aid recommendations for the three countries reportedly received the personal approval of President Carter. He often spoke in his presidential campaign of projecting U.S. values abroad, saying that "if other nations want our friendship and support, they must understand that we want to see basic human rights respected."

The aid request for Argentina has been reduced to $15 million in arms sales credits compared to $48.4 million proposed for the same purpose last year. Officials said not all of this cut is because of human rights, however.

The State Department reported to Congress two months ago, under Secretary of State Henry A. Kissinger's raised with Buenos Aires the issues of indiscriminate political killings and other human rights violations reported there. However, State Department officials said continued aid was in the U.S. national interest due to Argentina's strategic and economic importance.

In the case of Ethiopia, all of the military grant assistance - which came to $6 million last year - has been eliminated. However, arms sales credits of $10 million and economic development assistance of $13.9 million (up from $12 million this year continue to be recommended.)

Assistant Secretary of State for African Affairs William E. Schaufele Jr. (who was retained in the job by Carter) told Congress last August that, despite torture and political killings, continued U.S. aid was needed to "contribute to the stability of this second most populous country in black Africa." The United States continues to maintain in Ethiopia an intelligence communications base, which Schaufele called "Still very important."

The Carter administration decision to seek no new military aid to Uruguay follows a cutoff of fiscal year 1977 military aid to that country passed by Congress last September. President Ford, in a budget submission just before leaving office, had asked for approval of some Uruguay funds, the amount of which was not made public. The military-dominated government there is reported to have the world's highest proportion of political prisoners. The State Department previously backed continued aid on grounds that U.S. military assistance is a "treaty-like obligation."