MOSCOW, AUG. 4 -- When he joined Secretary of State James A. Baker III on Friday in condemning Iraq's "brutal" invasion of Kuwait, Soviet Foreign Minister Eduard Shevardnadze effectively reversed three decades of intense superpower rivalry over the Third World.

Moscow's new approach toward regional conflicts has taken shape gradually, and until last week, mostly rhetorically. But the moment of truth came early Thursday morning when Iraqi President Saddam Hussein sent thousands of Soviet-built tanks and aircraft into Kuwait. The Kremlin was suddenly faced with an extremely difficult choice: to stick by its old ally or join a U.S.-led arms boycott against Baghdad.

The remarkable scene at Moscow's Vnukovo airport -- with Baker and Shevardnadze standing shoulder to shoulder as they jointly called for international action against Iraq -- would have been inconceivable just a few months ago. The joint announcement was striking evidence of the Kremlin's determination not to allow ideological considerations to interfere with its improved relationship with the West.

Following the Iraqi invasion, Soviet commentators, recently freed from press censorship, have almost fallen over themselves to criticize a regime that was supported politically and militarily by Moscow for the better part of three decades. A typical article in the conservative daily Sovietskaya Rossiya accused Saddam of establishing an "absolute dictatorship" through the "physical annihilation" of his political opponents.

Writing in the more progressive Rabochaya Tribuna, foreign policy analyst Vladimir Mikhailov today described the Iraqi invasion of Kuwait as "a crime." He also heaped scorn on Baghdad's official explanation that it had sent its troops into its small southern neighbor in response to a request for assistance by Kuwaiti revolutionaries.

"We know all about such requests for the introduction of our troops 'in order to prevent foreign interference,' " Mikhailov remarked sarcastically, clearly referring to the official Soviet justification for the invasions of Hungary in 1956, Czechoslovakia in 1968 and Afghanistan in 1979. "The Iraqi leadership's version, which seeks in this way to justify the invasion of its neighbor, is more familiar to us than to many people."

The sharp criticism of Saddam in the Soviet news media comes against a background of mounting public disillusionment with the policy of providing almost unlimited support for hard-line, leftist Third World regimes in a Soviet search for geopolitical influence. Official figures recently released here show that the Soviet Union is owed the equivalent of more than $130 billion by client states in the Third World -- notably Cuba, Vietnam, and Syria.

Unlike many developing countries, oil-rich Iraq was able to pay the Soviet Union in hard currency for most of the weapons it received during the previous three decades. But it became strapped for cash as a result of its eight-year war with Iran and now owes Moscow over $5 billion, mostly from arms purchases.

The issue of Soviet arms deliveries to Third World countries has become a subject of major domestic controversy here over the past few months. The military's general staff has insisted that Soviet arms supplies allowed many developing countries to consolidate their independence in the face of "imperialist" attacks. But progressive academics and foreign-policy commentators have depicted the arms sales as morally reprehensible and economically disadvantageous to the Soviet Union.

Both economic and political considerations appear to be forcing the Kremlin to revise its policy toward the Third World and develop ties with traditionally pro-Western countries, such as Saudi Arabia and South Korea. Last month, President Mikhail Gorbachev signed a decree calling for a reduction in Soviet aid to Third World countries.

The central authorities in Moscow are also coming under pressure from Soviet republics to cut back on foreign economic assistance. In an interview this week, Mikhail Poltoranin, information minister of the Russian republic, said that the giant republic would act to stop subsidized deliveries of Russian oil to client states such as Cuba.

By imposing an arms embargo against Iraq, Gorbachev could be signaling a tougher policy toward other Soviet allies in the Third World. The Kuwaiti crisis has provided him with an opportunity to demonstrate the sincerity of his "new thinking" on regional issues -- just as last year's peaceful revolutions in Eastern Europe helped convince many previously skeptical Americans that perestroika was real.

In the short term, the Soviet arms embargo is likely to have little impact on Iraq, which has huge stocks of Soviet weapons. According to the London-based International Institute for Strategic Studies, Iraq has managed to build up its own armaments industry, with Egyptian assistance, making it less dependent on outside sources.

Over the longer term, however, Iraq needs foreign assistance in order to sustain its 1 million-strong standing army. According to Saddam, a temporary Soviet arms embargo in 1975 helped force Iraq to sign what Baghdad later denounced as an unjust border treaty with Iran.

Soviet officials have reacted cautiously to Iraqi promises to withdraw troops from Kuwait.