Indonesia has offered to turn one or two of its many islands into a temporary holding and processing center for up to 20,000 Indochinese refugees waiting for admission to new homes in other countries including the United States.

"I think the significance of the special processing center is that it can help to take pressure off countries that are feeling tremendous pressure now from the influx of boat people and others," said Dick Clark, the U.S. coordinator for refugee affairs, at a press conference today after discussions with Indonesian officials and a visit to a refugee camp near Jakarta.

Clark, here as part of a tour of five Asian nations to which more than 200,000 Indochinese have fled, said the United States fully backs the Indonesian proposal and also will provide financial help for the project.

Last month, the government of Indonesia offered to the U.N. high commissioner on refugees the use of Rempang Island, in the Riau group south of Singapore, as a center where Indochinese refugees could reside while being processed for transfer to third countries. This week government officials said Indonesia may also offer the neighboring island of Galang for the same purpose, which would make room for up to 20,000 refugees at a time.

Conditions set by the government of President Suharto for use of the Islands include firm commitment by third countries to take the refugees within a reasonable period of time and a promise that Indonesia will not have to bear any of the cost of developing, maintaining, administering, or supplying the islands or transporting refugees.

Indonesian Foreign Minister Mochtar Kusumaatmaja also said a five-year deadline would be set, at which time all refugees must have been transferred to receiving countries.

The islands would remain under the jurisdiction of the Indonesian government, which would make security arrangements, Mochtar said.

Clark, the former senator from Iowa, did not say how much the United States is prepared to contribute toward the special processing centers. He said no estimates of the operational costs have been made.

"We are prepared to help finance the center and we're confident that other countries in the world will be forthcoming with regard to this as well," Clark said.

He added that Japan has publicly announced willingness to share the cost.

A definite decision on the island proposal is expected to be made at a meeting of the U.N. High Commission on Refugees and representatives of 27 nations here in Jakarta May 15-16.

Rempang Island is about 144 square miles of mostly forested land with a population of 3,000. The allied nations used it as a prison for about 27,000 Japanese soldiers during World War II.

With more than 13,500 islands in its vast archipelago, Indonesia can spare one or two for refugee centers, Furthermore, Indonesia has only about 8,000 refugees on its shores, compared to an estimated 55,000 in Malaysia and about 130,000 in Thailand.

But Indonesia's leaders, like those of other underdeveloped Southeast Asian countries, feel they should not be expected to absorb or shelter refugees because they have enough difficulty providing for their own people.

Some Indonesian newspapers and officials also have stated opposition to the plan for fear of opening the country to communist agents in the guise of refugees. A newspaper often critical of the Suharto government, Merdeka, recently editorialized: "The geographic location and population composition should prompt concern about possible infiltrations and subversion through this region." CAPTION: Map, no caption, The Washington Post