King Hussein's ambitious $750 million, five-year development plan for the Israeli-occupied West Bank, although it has not even been announced yet, already has run into serious trouble, becoming a potential victim of the split between the Jordanian monarch and the Palestine Liberation Organization.

The plan is viewed by many West Bank Palestinians as part of a collusive carrot-and-stick approach by Israel and Jordan to win the hearts and minds of West Bank Arabs away from the PLO through an Amman-run patronage network. But the plan also appears mired by politics, lacking in substantial funding from the rest of the Arab world and to be facing growing opposition from the prospective recipients.

In addition, because of a widespread perception that the king has at least the tacit agreement of Israel to widen his operations in the West Bank, anti-Hussein sentiment is running high in the occupied territory, with almost daily demonstrations held at which pictures of the monarch have been burned and death threats issued against supporters of Jordan.

The plan's architects in the Jordanian government concede that the development plan could fail to get off the ground as a result of feuding between Hussein and PLO Chairman Yasser Arafat. But they insist that it was conceived long before the Feb. 19 falling out between the two, and that it was intended to be nothing more than an honest effort to improve the quality of life in the West Bank and to avert a security-threatening mass exodus of Palestinians to Jordan, whose population is already 60 percent Palestinian. "It is unfortunate that most measures taken to bolster steadfastness in the occupied territories find people ready to attach some political significance," Jordanian Prime Minister Zaid Rifai said in an interview.

"The drive has no political implications," Rifai insisted. "Nor is it an attempt on our part to create an alternate leadership in the West Bank. It is unfortunate that this is being interpreted as an attempt by Jordan to impose its influence on the West Bank . . . and the populations of these towns are paying the price," Rifai said.

However, Hussein's decision last week to close the 25 offices of Arafat's mainstream Fatah wing of the PLO and to expel its military commander, Khalil Wazir (Abu Jihad), has left many Palestinian nationalists in the West Bank convinced that the development plan is merely another step by Jordan to undermine the PLO. Its supporters claimed virtually every major town in the 1976 local elections, the last held in the occupied territories, and it remains widely popular there.

Palestinian nationalists note that Hussein's curtailment of PLO activities in Jordan has coincided with Israeli-imposed restrictions against PLO supporters in the West Bank, including detentions, denial of permits to travel to Amman and threats to close down pro-PLO Arabic newspapers in East Jerusalem.

Simultaneously, Palestinian nationalists said, the Israelis have loosened restrictions on some West Bank political figures who openly identify with Hussein instead of Arafat. Some of them reportedly have been permitted for the first time to drive their cars across the Jordan River bridges to Amman and back to the West Bank.

"The two governments are dreaming up a scheme to abolish any PLO influence in the West Bank. They want to break the PLO, but it will not work," said Israeli Arab Abdul Wahab Darousha, a Labor Party member of Israel's parliament.

Meanwhile, there were signs that the United States has begun to shift its emphasis on funding West Bank development, attracting criticism from some Palestinian nationalists that money is being steered away from projects associated with pro-PLO institutions and directed to moderate, pro-Jordan institutions.

The charges were denied yesterday by Morris Draper, U.S. consul general in Jerusalem, who said, "Our plan is not politicized."

As if intimidated by the threats by PLO supporters and recalling the assassination last March of appointed Nablus Mayor Zafir Masri, prospective mayors in three major West Bank cities -- Hebron, Ramallah and El Biera -- have been resisting the urgings of Jordanian government officials to seek appointments by the Israeli government to replace Israeli Army officers currently sitting as mayors.

After being summoned to Amman and encouraged to apply for the mayoral post in Hebron, Mohammed Jaabari, head of the city's education department, said he would take no such step without the approval of the PLO. Khalil Musa, former City Council member of Ramallah, and Walid Mustafa, a civil engineer from El Biera, also have balked at Amman's urgings to step forward.

Their reluctance is significant to the future of Hussein's development plan because Jordan has made it clear that it will funnel funds only to towns with Arab mayors.

"It is not possible to deal with any municipality run by an Israeli officer. We are saying to the populations of the towns, 'We are ready to help you. So decide if you want to keep Israeli officers in charge. It is your decision,' " Rifai said.

At an estimated cost of $150 million a year, and possibly rising to $240 million a year, the development plan is aimed at improving not only housing and education in the West Bank, but at developing new agriculture and industry there, which would be of economic benefit to the East Bank as well, through increased exports of products across the Jordan River, according to its architects.

Jordan's planning minister, Tahir Kanaan, a Palestinian who was instrumental in drafting the plan, emphasized, however, that little can be achieved unless the Israeli government relaxes its occupation policies and loosens its economic hold on the West Bank, permitting, for example, the establishment of Arab banks there and allowing more Palestinian entrepreneurship.

"Unless there is a change in Israeli practices . . . the whole exercise is an exercise in futility," he said.

With shrinking funding from Arab countries, Jordan has already appealed to the United States and the European Community for contributions to the new development fund.

Special correspondent Samira Kawar contributed to this article.