The government of President Joao Baptista Figueiredo moved during the weekend to crush a strike of 200,000 industrial workers in Sao Paulo, a show of force demonstrating the limits of the government's plan to liberalize political and social rights in Brazil after 15 years of military rule.

After hesitating for 10 days while the strike closed down major factories in Latin America's most heavily industrialized region, the government sent troops ot seize union headquarters, stripped union leaders of their posts and arrested more than 1,600 workers and bystanders in three Sao Paulo suburbs Friday.

The strike began March 13, only two days before Figueiredo assumed office and pledged "to make Brazil a democracy" during his six-year term in office. It was viewed by the government and some diplomatic observers as a political challenge to the new government's policy of gradual liberalization.

Despite its harsh response to the strike, government officials went to some lengths during the weekend to assure Brazilians that the process of liberalization would continue.

"Intervention was an isolated act and does not damage [the government's commitment] to liberalization," said Labor Minister Murilo Macedo. "It is not a tightening up."

Brazil has been ruled by a succession of military governments since 1964. Until reforms went into effect here Jan. 1, political and labor opposition was severely curtailed by a sweeping "institutional act" that gave the president the power to close congress, suspend any citizen's political rights, censor the press and deny the right to trial in political cases.

The changes have created in effect, a climate of increased expectations and liberty without specifically saying what is and what is not permissible. As a result, unions, students, the press, the church, and the official opposition party are all testing the government and Figuelredo to see what will be allowed.

Luiz Inaco da Silva, 33, Brazil's most charismatic union leader and one of a group of union officials deprived of their posts by the Labor Ministry decree, denied last week that the strike was inspired by anything more than economic issues.

"We workers are merely using our right to demand better wages," he said shortly before the government moved to end the walkout.

But Da Silva never explained why his union -- the metal, mechanical and electrical worker's union -- began the strike almost four weeks before its current contract expires on April 2.

The union demanded wage increases of 78 percent for the coming year, 34 percent above an official government wage index designed to keep pace with the country's 44 percent rate of inflation. The union also demanded the right to place a shop steward in each factory to help guard against a common practice here of firing workers before they reach top wage scales.

In addition to the political challenge the government saw in the strike, it apparently feared that a settlement above its wage ceiling, as a result of a strike that had been previously declared illegal, would be interpreted as sign of weakness that would encourage unions and other groups to challenge government policies.

"Combating inflation is incompatible with salary readjustments high above the increase in the cost of living," Figueiredo said in his first major economic address last week before the government moved to end the strike.

"In reality, demands, such as these are clitist, in that they only benefit minorities and use flagrantly illegal strikes as instruments of pressure," the president said.

Only hours before the government sent troops to surround union hadquarters and end the strike, the labor minister indicated that the government would accept a compromise increase of 63 percent -- halfway between its official ceiling and what the union was asking.

But Da Silva insisted that the compromise be submitted to the rank and file, who overwhelmingly rejected it Thursday, largely because they would not have been paid for the time they were on strike. After that vote the government moved in.

Although more than 1,600 workers were arrested Friday, only 26 of them remained in jail Sunday. Da Silva was not jailed, but the government ordered new union elections and prohibited him from running for reelection or participating in union activity.

The government also ordered work ers to return to their jobs Monday an order which observers were closely watching to see whether it would be obeyed.

In an editorial published Saturday, the influential Jornal do Brasil called the strike and the government's response to it "an episode in which no one won and everyone lost.... The government was obliged to take a genuinely antiliberal act at a moment in which it was launching the basis for a democratic political system.... The metalworkers have lost because the intervention means that the wage readjustment will now be uniformly made on the basis of the official 44 percent index."