France's decision to ship high-grade uranium to Iraq has outraged the Israeli government and touched off a new round of discussion here on Israel's own nuclear policy.

The French nuclear aid to Baghdad, which began last week, according to diplomatic reports from Paris, is viewed with particular nervousness in Jerusalem because Israelis consider Iraq among their most implacable and aggressive enemies.

Moreover, Iraqi nuclear capability, even if never translated into actual bombs, would end Israel's exclusivity among Middle Eastern countries in the ability to brandish the potential of atomic weaponry.

Prime Minister Menachem Begin on Monday called the French uranium deal "a very grave development." The parliamentary Foreign Affairs and Defense Committee, after a briefing by a high-ranking military intelligence officer, urged an Israeli response to what members called a direct new threat to Israel's security and a fresh source of instability in the region.

Deputy Defense Minister Mordechai Tsipori suggested in a speech Thursday that the response could include more direct actions than the angry diplomatic representations made so far to France and, through the United States, to Iraq. If these contacts fail, he said, "Israel will have to consider its next steps."

"Israel cannot sit and wait for an Iraqi bomb to fall on its head," added the director general of Begin's office, Matityahu Shumuelevitch.

The public and official outcry was sharpened by publication of a prediction by an intelligence officer who briefed parliamentarians that the French assistance to Iraq includes very high-grade uranium and could enable Baghdad to produce several atom bombs by the mid-1980s.

Some Israelis have suggested, however, that the loud alarm could rebound against Israel by calling attention to Israel's own nuclear capability and its refusal to sign the Nuclear Nonproliferation Treaty.

The uproar could lead to proposals for increased international safeguards in Iraq in exchange for Israeli acceptance of similar restrictions that have been refused by successive Israeli governments, they said.

In addition, Israeli critics of the Begin government contend that Israel should refrain from criticizing French nuclear aid to Iraq too strongly, lest it be recalled that French aid was instrumental in setting up Israel's own secret nuclear facility two decades ago at Dimona in the Negev Desert.

The U.S. Central Intelligence Agency concluded as early as 1974 that Israel had produced nuclear weapons in a prograam centered at Dimona and supplied with enriched uranium "partly by clandestine means," according to a CIA report made public in January 1978.

Israeli governments have always refused to confirm or deny reports that they have stockpiled atomic bombs, referring only to a carefully worded statement worked out by former prime minister Levi Eshkol that "Israel will not be the first to introduce nuclear weapons into the Middle East."

Even this has been a deterrent, however. Most Arab governments work on the assumption that Israel has the ability to field nuclear weapons if the political decision were made. Arab officials sometimes refer to a declaration by former Israeli president Ephraim Katzir, who told visiting science writers here in 1974 that Israel has "the potential to produce atomic weapons" and added: "If we need it, we will do it."

The current uproar has generated a new and slightly more explicit reference to the possibility of nuclear war in the Middle East.

Moshe Dayan, who has been both defense and foreign minister, was reported to have told a gathering of political supporters that Israel will not be "too late" in using nuclear weapons if the situation demands it.

Perhaps because of their own experiences, Israelis have brushed aside French assurances that the Iraqi sale will be used for peaceful purposes only.

Yuval Neeman, one of Israel's leading physicists and a rightist politician, said after a meeting with the French science attache here that in his opinion the 165 pounds of enriched uranium reportedly being shipped to Baghdad for use in a French-built reactor can serve only military purposes because "there are no rudiments of nuclear research in Iraq."

To demonstrate their irritation, some ministers and members of parliament boycotted a Bastille Day reception given by French Ambassador Marc Bonnefous on Monday. The Israeli state radio reported French Prime Minister Raymond Barre's appearance at an Iraqi reception in Paris as a sign of French determination to ignore the Israeli protests.

France's policies toward the Arab world, particularly its call for increased Palestinian participation in peace negotiations, have generated resentment here in any case. The nuclear deal is being portrayed in the press as part of a pattern revolving around Iraqi oil supplies and including French arms sales to President Saddam Hussein's government in Baghdad.

Foreign press reports suggest that there are additional reasons for strain in French-Israeli relations.

Citing French intelligence sources, several publications have blamed agents of the Israeli secret service, Mossad, for the bombing of two reactors under construction last year for Iraq at Toulon, France.