The possible revival of U.S. military assistance to both Argentina and Chile has become a casualty of the Falkland Islands crisis.
State Department officials said yesterday the subject of human rights progress in those countries, which the administration must certify before it can resume arms aid, has been put on the back burner until the Falkland episode is resolved.
The effect is to put off for an indefinite time the Reagan administration's effort to shore up with military training funds and arms sales two countries which it regards as bulwarks against communism in Latin America.
Meanwhile, the administration's new emphasis on reviving military aid to Guatemala ran into congressional skepticism yesterday. A key congressional subcommittee chairman, Rep. Michael D. Barnes (D-Md.), said he would not agree to certifying Guatemala as eligible for assistance until his staff has investigated human rights issues there.
Military assistance to all three countries had been canceled because of human rights violations, although the administration last year won legislative authorization for renewed aid to Chile and Argentina if it could certify to Congress' satisfaction that human rights issues had been resolved.
The State Department's assistant secretary for human rights, Elliott Abrams, told Congress yesterday that, despite improvements in Argentina, consideration of certifying that country "is on the back burner" because of the seizure of the Falkland Islands. To certify Argentina "in the time of the Falkland crisis would be to send a signal we don't wish to give," Abrams said.
Falkland residents prefer British control, which raises the issue of self-determination. The department has not yet addressed that as a human rights issue, he added.
He said the Argentine certification was being discussed at the assistant secretary's level when the islands were seized but is no longer under consideration. It may be "a number of months" before it is raised again, he added.
Later, a State Department official who asked to remain unidentified said a suspension of the Argentine discussion meant also that no consideration would be given to certifying Chile for eligibility. He explained that it had been agreed to consider both countries simultaneously because they are involved in a dispute over three islands in the Beagle Channel.
To consider one and not the other could be interpreted as expressing favoritism, the official said.
The department already had been hung up on the question of certifying Chile for assistance because of a difficulty in proving there had been Chilean cooperation in resolving the case of Orlando Letelier, the former Chilean ambassador who was assassinated in a bomb blast in Washington.
The administration has requested $50,000 in fiscal year 1983 in military training funds for each country.
Meanwhile, the administration yesterday pressed its case for resuming a small amount of military assistance to Guatemala. Deputy Assistant Secretary of State Stephen Bosworth told the Senate Foreign Relations Committee that, although no formal request has been made, Guatemala wants spare parts for helicopters and funds for military training.
He indicated the United States hopes to move quickly to help Guatemala restore confidence in its economy and develop natural resources. Other sources said the administration is considering the sale of helicopter parts.