Reliable reports that Singapore has supplied assault rifles to the forces of Son Sann, which are fighting Vietnamese occupation troops in Cambodia, have spotlighted Singapore's position as the first developing country to establish its own independent, internationally competitive arms industry.

So successful is the Asian republic that where it once produced arms under license for the United States, the tables could soon be turned, with the United States manufacturing Singapore-designed arms under license.

Singapore maintains a high defense profile as a member of the Association of Southeast Asian Nations, but its potential role as an armaments center has not received nearly so much publicity. Nevertheless, Singapore is well on its way toward achieving its goal of becoming the "Switzerland of Sougheast Asia."

Hanoi, whose troops occupied Cambodia early in 1979, has accused the Singapore government of transporting the 2,640 SAR80 rifles to Son Sann's anti-Vietnamese coalition forces by sea and through Thai territory with the aid of the shipment was paid for, although one diplomatic source said, "Let's put it this way. If the U.S. supplies [the coalition] with food, then they can spend their food money on something else."

The SAR80 is a product of Chartered Industries of Singapore, a company owned by the Ministry of Defense. It and a new light machine gun, the Ultimax-100, are the first assault rifles in the local line.

Until 1979, Chartered made the M16 under license from the American firm Colt. After deciding that Colt was asking too much money for the license, CIS started its own production line in April 1980. About 40 percent of the SAR80 is based on and fully compatible with the M16, but it is cheaper to produce than other European models and the M16 itself.

Parts of the design are also derived from Britain's Sterling M15.

The Ultimax-100 is a 5.56 mm light machine gun that entered full-scale production in May for the Singapore armed forces. Colt and Sterling Armament Co. of Britain will market it in the United States and Europe. According to industry sources, Colt will use the Ultimax to try to dislodge the Belgian Minimi from U.S. military favor. Should Colt find a sufficiently large U.S. market, Chartered Industries has plans to negotiate agreements for licensed manufacturing.

The Singapore government has not denied the reports, from Western as well as Vietnamese sources, that one of their two newest entrants into the international arms market has been supplied to the coalition forces under Prince Norodom Sihanouk, Son Sann and Khmer Rouge leader Khieu Samphan.

Evading the question in Singapore's Parliament last week, Foreign Minister S. Dhanabalan was quoted as saying that "public disclosure of who had supplied the Cambodian patriots with arms, what was supplied and the conditions imposed can only help the Vietnamese." Singapore has been a harsh and vocal critic of the Vietnamese invasion of Cambodia.

The government is highly sensitive about its arms industry, particularly its historic relations with the Israeli military, which helped establish the Singapore Armed Forces Training Institute.

Chartered Industries was founded by a former director of ordnance production in Australia, Laurence Hartnett, under secondment to the Singapore government in 1966. Hartnett decided to use the U.S-made Colt M16 as Singapore's basic weapon, and drew on advice from U.S., French and German munitions industries to set up ammunition manufacturing.Chartered's 5.56 mm high-velocity ammunition was sold to Australia for use by its troops in Vietnam. Production of the M16 for export followed.

Chartered also began production of antiaircraft ammunition and mortar and other bombs. Through nine subsidiaries, Chartered also produces the U.S. M203 40 mm grenade-launcher, as well as being licensee for Bofors in Sweden, Oerlikon in Switzerland, Nico Pyrotechnik in West Germany and Soltan in Israel.

Since the early days after the separation of Singapore from Malaysia in 1965, the question of modeling Singapore's military on Israel has become increasingly controversial, moving Prime Minister Lee Kwan Yew to shift his preference to the Swiss approach.

"People put their money in Switzerland. That's what we must aim to be," he said in a speech this year. "Never get caught in the Israeli syndrome. I am not saying that the Israelis want wars. But they seem to have been caught in a cycle where they are in a war almost every few years."

Singapore's role as the ASEAN arms capital will become more pronounced as talks among it and the other four members -- Thailand, the Philippines, Indonesia and Malaysia -- on military cooperation expand. During an autumn visit to Indonesia, now an official ally although ties between the two nations have periodically been strained, Lee urged joint military exercises as well as continued cooperation in intelligence and security matters. But it is not yet clear whether he draws a line between cooperation and arms supply to allies.