WASHINGTON — The State Department's No. 2 official rejected advice Sunday that the Reagan Administration break off efforts to arrange a summit meeting between President Reagan and Soviet leader Mikhail S. Gorbachev until American reporter Nicholas Daniloff is free to leave the Soviet Union.
But John C. Whitehead, the deputy secretary of state, said that if Daniloff is not free by the start of a top-level U.S.-Soviet meeting this week, his continued detention in Moscow will be near the top of that meeting's agenda. He said he remains optimistic that a summit will take place before year's end.
The immediate irritant in U.S.-Soviet relations--Daniloff's incarceration in Moscow and the jailing in New York of a Soviet physicist assigned to the United Nations--was removed Friday when the two were let out of prison and placed in the custody of their respective embassies. But each has been ordered to stand trial, and their freedom is sharply curtailed.
The Soviet defendant, Gennady F. Zakharov, was arrested Aug. 23 by the FBI on espionage charges, and Daniloff was jailed a week later by agents of the KGB, the Soviet security and intelligence organization.
Whitehead, appearing on the CBS News program "Face the Nation," said that diplomatic negotiations continue in an effort to resolve the dispute.
Daniloff, he said, "was set up, and he must be freed." But, pressed about whether Zakharov would be put on trial, "no matter what," Whitehead appeared to signal that the treatment of the Soviet citizen remained uncertain. He said: "As of the moment, he will be tried."
Referring to this Friday's meeting, in which Secretary of State George P. Shultz and Soviet Foreign Minister Eduard A. Shevardnadze are scheduled to discuss plans for a Reagan-Gorbachev summit, Whitehead said that "you can be sure, if Daniloff is not free by the time that meeting begins, that this subject will be very high on the agenda."
But he clearly indicated Administration determination not to let the incident derail a meeting of the two leaders.
"We can only discuss this so far," Whitehead said. "If they refuse to set him free, the world must go on. This is an important issue, but of course, it's not the only issue.
"We can only gain by discussion," he continued. "If we terminate all discussions with the Soviet Union, then we cannot make progress on this case or on anything else."
The Administration has maintained that Zakharov was caught in the act of buying secrets from an FBI informant in New York, while Daniloff was engaged in legitimate journalistic pursuits when he was seized after accepting from a Soviet acquaintance a package of documents the KGB later identified as "top secret" military maps.
The Administration's position--which has been to insist that Zakharov would not be traded for Daniloff while at the same time doing nothing to turn aside progress toward a summit--drew sharp criticism Sunday from Sen. Richard G. Lugar (R-Ind.), chairman of the Senate Foreign Relations Committee, and Sen. Daniel Patrick Moynihan (D-N.Y.), a member of the Senate Select Committee on Intelligence.
Lugar urged the United States to show "a very different attitude" than it has demonstrated in the incident thus far. He said that unless the issue is resolved before Shultz meets with Shevardnadze, the Administration should state that the agenda "would be Daniloff alone."
Appearing with Lugar on the ABC News program "This Week with David Brinkley," Moynihan said that if Daniloff is not back in the United States by the end of September, "I don't think we should even discuss . . . a meeting between our two leaders."
In Moscow, Gennady I. Gerasimov, a Soviet Foreign Ministry spokesman, said the Soviet Union hopes that the Daniloff and Zakharov cases can be settled "in a quiet, diplomatic way" and that a "reciprocal basis" can be applied.
Gerasimov, also appearing on the ABC program, gave no indication of what approach the Soviet Union will take in trying to resolve the incident, now that the two men are out of jail.
In a view contrary to that of U.S. officials and other Soviet experts in this country, Gerasimov indicated that Daniloff's arrest had not been approved by the most senior Kremlin officials.
While saying that he did not know whether Gorbachev and the Politburo cleared Daniloff's detention in advance, he declared: "My guess is that this is just day-to-day work of people in counterintelligence. And I don't think that they ask permission any time they have a suspect and they want to take him into their custody."
Moynihan, however, said:
"We know . . . that the decision on Daniloff was made in the Politburo. After all, the head of the KGB (Viktor M. Chebrikov) is a member. And the decision was one to put in jeopardy the summit."