China told the Soviet Union today that it would not renew their 30-year treaty of friendship, alliance and mutual assistance when it expires next year, the official New China News Agency announced.

At the same time, China proposed negotiations with Moscow "for the solution of outstanding issues and the improvement of relations between the two countries," the agency added. Relations between the two communist powers have been bitter for years.

The treaty, which named the United States and Japan as common enemies of Peking and Moscow and pledged joint action against "Japanese imperialism," was due to expire April 11 next year. An article in the treaty however, said it would be extended another five years, unless either side announced otherwise one year in advance.

The treaty was signed in Moscow Feb. 14, 1950, and went into force April 11 the same year-a time when China and the Soviet Union were close allies.

The two ideological enemies now regularly exchange threats and insults, and the world political situation has changed radically. The United States and China established diplomatic ties this year and Peking and Tokyo signed a peace and friendship treaty last year.

In moscow today, a Soviet radio station denounced China's decision to end the treaty, accusing Peking of pursuing an "anti-Soviet, antisocialist policy."

[Radio Peace and Progress said comments by the Chinese news agency that the treaty long had existed in name only, and that China had not broken it, "have nothing to do with reality."]

The Chinese statement said, "In view of the fact that great changes have taken place in the international situation, that the treaty has long ceased to exist except in name, owing to violations for which the Chinese side is not responsible . . . the National People's Congress . . . decided not to extend" the treaty.

China said it formally notified the Soviet Union of its action in a meeting between Foreign Minister Huang Hua and Soviet Ambassador Ilya Shcherbakov in Peking.

Huang said that although the two nations differed on principles, this should not hamper the maintenance and development of normal relations.

Western observers noted that the Chinese move is unlikely to have much practical effect, unless the Soviets respond dramatically.

[In Tokyo, news of China's decision to scrap the treaty was welcomed. Chief Cabinet Secretary Rokusuke Tanaka told reporters that the move was highly appreciated.]

Chinese senior Vice Premier Deng Xiaoping (Teng Hsiao-ping) reportedly promised that the treaty would be abrogated when Japanese Foreign Minister Sunao Sonoda visited Peking last year to sign the peace and friendship treaty.

It was widely reported that Japan's willingness to enter into the treaty with Peking was based on assurances that China would end its participation in the pact with Moscow.

When the treaty was signed 29 years ago, the United States took it as proof that the Chinese Communists had "enslaved" themselves to Moscow and in turn stepped up its policy of "containing" communism.

For Chinese leader Mao Tse-hung, however, the pact was seen as a deterent against a possible U.S. or Japanese invasion and a way to obtain additional Soviet economic aid.

China received a large low-interest loan and technicl assistance to help restore Chinese heavy industry. For its part, Moscow insisted on maintaining special interests in the northwest border region of Xinjiang (Sinkiang) and in Manchuria.

Mao was rankled by the unequal treatment he felt he received in the treaty negotiations, however, and by 1958 he began to lead China along a separate road to communism. By 1962, when border fighting broke out in the northwest region, the treaty already was virtually dead. CAPTION: Picture, HUANG HUA . . . notifies Moscow