NICOSIA, CYPRUS, JAN. 20 -- Here are excerpts from the radio address today by Iraqi President Saddam Hussein. The five-minute broadcast was monitored in Cyprus:

"In the coming period, the response of Iraq will be on a larger scale, using all the means and potential God has given us and which have so far only been used in part. Our ground forces have not entered the battle so far, and only a small part of our air force has been used.

"It remains for us to tell all Arabs, all militant believers . . . wherever they may be, that it is your duty to embark on holy war. . . .

"You should target their interests wherever they may be. This is your duty, and you should use it to complement the struggle of your brothers in Iraq.

"You will form a part of the militant armed forces through your holy war and your struggle. You will form part of the front of faith and believers.

"We and our steadfastness are holding.

"Here is the great Iraqi people, your brothers and sons of your Arab nation and the great faithful part of the human family. We are all well. {Our forces} are fighting with heroism and courage which is unprecedented in the history of war.

"The infidel tyrant's missiles and aircraft are being destroyed.

"He is wondering how the Iraqis can confront his fading dreams with such determination and firmness.

"After a while, he will begin to feel frustrated, and his defeat will be certain, God willing. . . .

"You {the Arab people} will be part of the struggling armed forces in your jihad {holy war}. . . .

"If the opposing multitude captures you, you will be prisoners in their hands even if they refuse to admit this in their communiques and statements. {The United States has said it will turn Iraqi prisoners over to the Saudis.}

"You will inevitably be released when the war ends in accordance with international laws and agreements which will govern the release of prisoners of war."