In a mythic setting of mote wilderness forest, sinewy Russian workers are steadily making reality of a longheld Soviet dream to open central Siberia's riches to world markets via a remarkable, costly new railroad.

Each day, crews of dynamiters, tunnellers, masons, welders, and truck and heavy machinery operators move out in bitter cold from this isolated log cabin settlement to carve an immense turn through a nearby granitegranite mountain. The Baikalski tunnel, now 1,300 feet into the base of the 4-mile wide peak, is just one of the many crucial construction points along the 2,000-mile path of the new Baikal-Amur-Mainline railway, or "BAM" as it is known throughout the Soviet Union.

The Soviet Union is accustomed to massive projects, such as the 18-year struggle to exploit the West Siberian oilfields near Tyumen, or the pioneering project to build an all-scientific research city near Novosibirsk. But BAM is perhaps the most challenging. Official propaganda calls it "the hero project of the century." One might well wonder if this is not accurate.

BAM will cross the deserted, pine-covered peaks and valleys of three major mountain ranges, traverse more than 500 miles of seismically active earth, run across hundreds of miles of swamps virtually impenetrable when unfrozen in the summer, and bore through six mountains along the way for a total of almost 17 miles. Everywhere there is permafrost, requiring special insulation against heat from passing trains that could melt the frost and sink the track. The region's nine months of intense cold means special metal alloys are needed in the track to keep it from snapping.

Millions of trees will be felled, log towns will spring up overnight to service the laborers, to be dismantled and moved to new sites or made permanent stations, or repair and

Soviet Union doubles gasoline prices, raises coffee to $13.25 a pound. A21. supply depots. Hundreds of miles of roads, electric lines, bridges and trackbed have already been webbed across the Taiga. In all the project will cost about $3.5 billion, according to latest estimates. In a sense, however, cost is no project. The leadership wants the BAM and it will get it.

How soon and at what cost trains can begin their journey will in large measure be determined by the pace of work here and at the other sites. Initial completion date is now scheduled for 1983 and all work will be finished by 1985, officials say.With the schedules now being met after some early delays, they expect the trains to be running the full length of the BAM by 1983.

Soviet officials, obviously pleased at the progress recently brought a group of foreign correspondents for the first time to a corner of the Buryat Autonomous Republic in eastern Siberia to see for themselves how the much-ballyhooed project is doing.

Begun only three years ago, the right-of-way from the central Siberian railhead of Ust-Kut, northwest of Lake Baikan, to the city of Komsomolsk near the Pacific coast now teems with thousands of workers. Through a combination of propaganda, extraordinarily high pay and outright edict they have been gathered by the Soviet command economy to lay siege to the vast Taiga, or pine forests, where bear, reindeer, sable and wolf abound.

In an age of dwindling frontiers, a visit here yields a refreshing taste of an appealing, rough-and-ready life of privation, isolation and purposeful manual labor, in return for an array of special incentives designed to attract -- and hopefully keep -- thousands here.

This settlement of 1,300 has endured winter snow accumulations of 12 feet and cold down to 45 Fahrenheit, so intense that nails snap, hammers break and spectacles shatter. In summer, temperatures soar above a hundred and fearsome swarms of disease-laden mosquitoes attack unceasingly. The work goes on.

Since the first handful of workers helicoptered in here three years ago to begin laying a road back to civilization, much has been accomplished. The main tunnel, about 23 feet diameter, is now progressing at the rate of 10 feet a day beneath the Davan, or "mountain pass" as the steep-granite peak is known in the native language of Buryat. When completed in about six more years, it will be 4.1 miles long wide enough for a single track. Two other smaller tunnels accompany the main shaft: one to drain water flooding into the main tunnel: and a "reconnaissance" tunnel, pushing slightly ahead of the main work, to determine the changing rock formations so no mistakes will be made in dynamiting.

The settlement seethes with activity: a huge Japanese-made drill frame noisily sinks holes for dynamite in the tunnel face; German-made trucks and earth moving and hydraulic equipment bought from Ingersoll-Rand. Caterpillar and General Motors grind and roar at the tunnel mouth freight rubble out of the cavity. There is similar activity the length of the route.

This is the second time the railroad has been attempted. An earlier effort, using forced labor, began in the late 1930's, but was halted when World War II began. Tracks were removed and sent west to bolster rail lines into beleaguered Stalingrad.

As with the Alaska pipeline, there have been allegations of waste and mismanagement. Pravda, the official Communist Party newspaper, last year reported shortcomings with unusual candor, provoking some changes.

Vladimir Ostrovsky, editor of the local northern Baikal newspaper, reprinted the Pravda articles for his 8,500 readers scattered across Buryat.

"The criticism was shared to the letter," he asserted, "and things changed afterwards."

This intense pride and openness about the project is shared here, 55 miles by primitive logging road from Nuhneangarsk, the nearest permanent town, Tamara Akhkozova, settlement party secretary, happily ticked off the advantages for workers willing to brave the cold, isolation and outdoor plumbing to sign and keep a three-year work contract.

Housing is free, but they pay for the food. There is better food here than usual and tunnel workers get free milk. Ninety percent of the workers have signed the contract and they have a right to buy a new car with their money when they leave."

Anatoli Lunis, a 30-year old tunneler, said "In the Soviet Union, BAM is the greatest construction project in length, work volume and hard conditions. Aircraft is good, maybe, but the railroad is better. It is more economical and has great load capacity." In the next breath, he said he wanted to buy a car when his three year commitment ends.

Lunis earns about $500 a month, received a one-month bonus for signing up, has a free annual rountrip airfare anywhere in the country. His vacation is 36 days, instead of the usual 24, and a set of heavy work clothes, fur hat, boots and coat that might cost more than $130 was free for him.

In addition, the contract guarantees his old apartment, whether in Moscow or any other city.Even though Rusians wait for years for new apartments and housing has been in chronic short supply, the apartment of BAM workers like Lunis stand empty all over the country, waiting for the return of the workers, a sirene song which may some day confound the hopes of Siberians who believe many of the present BAM workers will settle in the wilderness.

At the eastern end of the railroad, military rail laying crews are at work and foreign reporters who visited the area recently were not allowed into these military camps. Officials at the Baikal end of the route said that army crews are being used only in the easternmost portions and that no prisoner are forced labor are being used on the BAM.

Goudhekitz one day will be a station along the single-track right-of-way. Now it is a collection of tasteful log houses and one-story rambling apartments and dormitory buildings, buried nearly up to the eaves by drifting snow. It boasts a club, a 150-seat movie theater, a store and a school. Forty percent of its citizens are unmarried men who live in dormitories, three to a room, 50 to a communal kitchen. About 20 percent of the workers labor inside the tunnel.

Drunkenness, a problem in provincial Russia, seems minimal, perhaps because the sale of hard liquor is sharply restricted. Work ceases when the temperature hit -45 degrees centigrade; this year has been unusually warm, causing only three days lost to cold instead of the usual dozen.

Lunis is not as far up the bonus scale as some experience machine operators, who, with all their benefits, might earn nearly $1,000 a month, a handsome sum in a nation where the average wage is one sixth as much.

Other young tunnel workers interviewed at random expressed the same general satisfaction with the pay and their role in the project.

One young woman, Tanya Yakimenko, 22, willingly opened her tiny, two room apartment to visitors. "I am satisfied," she said with a smile as reporters crowded into the small rooms, sat onall the chairs and the bed and tromped with muddy boots on the machine-made oriental rugs on the floor of the living room-bedroom while commenting about a small portrait of Ernest Hemingway on the wall.

Yakimenko and her 25-year old husband, a tunnel engineer, came to Goudzhekit from the Ukraine last year, leaving their one child at home with her mother. A pianist who was trained in the Ukraine, the young woman has found a job working at the club, teaching children music.

Although the first train from the Ust-Kut railhead several hundred miles to the west is not due here until December, BAM has already meant profound changes for the north Baikal district, a region of Buryat as big as two Switzerlands.

Three years ago, 5,000 people, mostly, trappers, hunters, fishermen and loggers lived scattered throughout the tiaga-covered mountains and along the northern shore of Baikal. Today, some 25,000 live here, including about 2,000 a piece in six rail construction camps, 2,500 in the once-tiny Baikal port town of Nizhneangarsk and 8,500 in the nearby small city of Severo Baikalsk, which did not exist at all four years ago.

The district party chief, Nikolai Kryucikov, confidently predicts 60, 000 will be living here within a few more decades. He may be right. The railroad itself will mean thousands of permanent jobs for maintenance and track-clearing crews, signalmen and others.

The BAM route carries it near the important south Yakutia gas and oil fields and copper deposits at Udokan, past iron, asbestos, manganese, gold and silver deposits just now being defined by geological teams, and across the north-south rail line carrying coking coal from the huge fields of Tynda near BAM's midpoint.

Together, these vast newly exploitable resources are going to act as a magnet for unskilled workers and anyone interested in taking for himself a share of the higher wages paid for work east of the Urals.

In the end, the "hero project of this century" seems destined to have lasting effects on the next century as well.