What was going on when I was born?

The Reagan Administration said today that it had begun talks with China on the possibility of an agreement on nuclear cooperation that would enable American companies to help develop China's nuclear power industry. Deputy Secretary of State Walter J. Stoessel Jr. made the disclosure in a policy speech on China in which he said that President Reagan valued United States relations with China ''highly'' and ''believes it is important to work together to expand the benefits to both countries.'' Contending that too much attention had been paid to Washington-Peking differences over Taiwan, Mr. Stoessel also revealed that in a recent directive Mr. Reagan reaffirmed a policy of ''substantial liberalization'' in the export of technology to China. Mr. Reagan, according to Mr. Stoessel, declared that American export policy ''should support a secure, friendly and modernizing China.''

Cracow remains quiet under martial law A2 New York Congressman presses El Salvador on nuns A4 Around the World A5 Sudan's leader suggests Arab meeting to try to end gulf war A6 Reagan defends British actions in Falklands A14 Government/Politics House returns to struggle with 1983 budget A21 Senator John C. Stennis wins renomination for seventh term A22 New York Assembly to consider bill to allow TV in courts B4 Koch warns of service cutbacks unless State Legislature acts B4 High Court upholds utility law in states' rights case B6 Washington Talk Government sharply cutting back on its publications A20 Briefing A20 Required Reading A20 Decision File A20 General Space shuttle's glow called an obstacle to some tests A9 Racial violence in Boston forces a black family to move A18 Missouri farmer freed from jail by bankruptcy judge A18 Around the Nation A18 Court blocks rescission of passive restraint rule for new cars A21 The city and the A.S.P.C.A. agree on closing a budget gap B3 Religion Pope exhorts Scots to vindicate their ancestors' struggle A16 News Analysis William Borders examines Britain's options in the Falklands A14 Drew Middleton examines decision facing British military A15 The Living Section Food Raw shellfish: How risky is it? C1 The syntax of food adds spice to language C1 A Northerner's way with soul food C1 In Antarctica, food keeps out the cold C3 The 60-Minute Gourmet: "variety meats" at home C3 Food Notes C9 Wine Talk: the rich, spicy zinfandel of Lytton Springs C16 Living Once again, etiquette is a popular topic C1 Metropolitan Diary C2 Kitchen Equipment: an electric rice cooker C2 Personal Health: precautions against exotic ailments C12 Discoveries C18 Arts/Entertainment A 1969 film, "A Time for Dying," in New York premiere C19 Authors beg editors at convention to buy manuscripts C21 Hollywood is forced to take a new look at ratings system C21 Rock musicians's special affinity for Hoagy Carmichael C23 Kid Creole has a possible break- through rock album C23 Joyce Theater for dance opens in Chelsea C23 "American Journey" by Richard Reeves is reviewed C25 Collector surrenders two Durer paintings he bought for $450 C26 WABC-TV dominates New York City ratings for news programs C26 Obituaries Eleanor Naylor Dana, philanthropist and social leader B5 Sports Vecsey on Indy's pace-lap blues B6 Jays, on 4 in 8th, beat Yanks B7 Braves turn back Mets, 7-3 B7 Fairbanks to coach New York team in new football league B7 Lakers rout 76ers, lead, 2-1 B7 76er owner makes presence felt B7 Wilander upsets Gerulaitis, Miss Austin loses in French Open B9 Features/Notes Man in the News: Roger Mark Adelman, Hinckley attorney D19 About New York B3 Sports People B8 Going Out Guide C19 Editorials/Letters/Op-Ed Editorials A26 On disinheriting the P.L.O. Trimming interest rates A new standard for Mr. Smith Topics: competition Letters A26 Russell Baker: more on the school necktie amendment A27 James Reston: Reagan's grand tour of Europe A27 Jonathan Power: Palme's report on disarmament A27 Aaron D. Rosenbaum: Middle East peace A27

The Supreme Court ruled today that manufacturers of generic drugs whose products imitate the shape and color of name-brand drugs cannot ordinarily be held liable when pharmacists mislabel and sell their generic product as the higher-priced brandname drug. The decision was an important, if partial, legal victory for the generic drug industry. It overturned a ruling by the Federal appeals court in New York that three generic manufacturers were liable for ''contributory trademark infringement'' because pharmacists had been substituting their product for the identical-looking brand-name drug, Cyclospasmol. More Important Question However, the Supreme Court did not rule on the more important legal question of whether the generic manufacturers' practice of imitating the appearance of the brand-name drugs constitutes, by itself, a trademark infringement. The Court directed the appeals court, the United States Court of Appeals for the Second Circuit, to decide that issue.

Pabst, itself a takeover target of two other brewers, is seeking 49 percent of Olympia Brewing for $35.56 million. The announcement startled the financial community. It also came as a surprise to Olympia, which said its board would probably discuss the offer today. Pabst is the fifth-largest brewer, and Olympia is No.8. (Page D1.) Mesa Petroleum said Cities Service had rejected its $3.8 billion takeover bid. Cities Service, in an effort to cut off Mesa's financing, was reportedly ready to question Mesa's bankers to see whether they knew of its takeover plans. The bankers are thought to be Continental Illinois and the Bank of Montreal. (D1.)

A music note in Arts and Leisure Sunday gave an incorrect location for the concert performance of the Lat- vian national folk opera ''Banuta'' on Saturday at 2 P.M. It will be at Carne- gie Hall.

Persuaded that a cease-fire is almost impossible, Secretary General Javier Perez de Cuellar has begun considering the United Nations' role in the Falkland Islands after the Argentine collapse, the Secretary General's aides said today. Mr. Perez de Cuellar has been exploring what forces might replace British troops in the islands, the nature of a United Nations administration there and the conduct under United Nations auspices of face-to-face talks between Britain and Argentina, they said. The Secretary General has also been pursuing one last effort to reduce bloodshed and lessen Argentine humiliation in what are regarded here as the final days of the conflict: He has been talking to the British about deliberately slowing their advance on Stanley, the islands' capital. Magnanimity Urged by Haig That would enable Argentina to evacuate members of the large garrison there with their arms and some measure of honor.

An article in Business Day last Wednesday incorrectly identified the liver disorders that a 1973 Food and Drug Administration study linked to the use of Ilosone, an antibiotic marketed by Eli Lilly & Company. The drug's use was linked to increased incidence of inflammatory reaction and jaundice.

FOR those who love to eat fresh, briny oysters or sweet, succulent clams on the half shell with nothing but a squeeze of lemon juice - and there are many - warnings about the hazards of raw shellfish from experts like Dr. Donald Francis usually go unheeded. Dr. Francis, assistant director of the hepatitis division of the Centers for Disease Control, says, ''In general, one should not eat uncooked animal flesh.'' But even Dr. Francis admits that when scientists from his laboratory go to a city to investigate an outbreak of hepatitis from shellfish, ''They always bring a lot of them back to eat.'' Despite the enormous potential for problems, records indicate that remarkably few people become seriously ill from eating raw shellfish. It may be, as some health officials believe, because the records are not adequate. Or it may be because the standards for shellfish sold commercially are very high. In the last five years there have been no confirmed cases of hepatitis or typhoid, the two most serious diseases associated with these foods, from eating shellfish taken from the waters in New York State, even though some of these waters are polluted. The Centers for Disease Control in Atlanta, which monitor outbreaks of infectious diseases in this country, report less than 100 cases of hepatitis from tainted shellfish nationwide in the last five years.

Legislative leaders in both houses announced plans today to approve measures that would restore virtually all of the programs Governor Carey vetoed two months ago. The vetoes, which the Governor said were intended to bring the budget into balance, led to an outcry from schools and local governments. If the new measures become law, they would provide a total of $386 million in funds for schools, local communities and criminal justice programs. New York City would get more than $100 million.

-------------------------------------------------------------------- Anthony Burgess, the British novelist, is author, most recently, of ''Earthly Powers'' (Simon & Schuster). By ANTHONY BURGESS MONTE CARLO, Monaco IT never takes long, when discussing drink or food, to realize the inevitability of drawing on the French language. Many people in Britain or America only properly meet French on menus or in the cookery books of Julia Child, which means that, for them, the language is circumscribed by the kitchen. What they consider to be the elegance or exactitude of French is derived from the memory of palatal events that can be renewed, either in Paris or in the dining room of a neat professorial home in New Hampshire. French dishes, like pieces of music, can be performed with only minor mutations of tempo and dynamic (read, if you wish, seasoning). The Empress Josephine, while still living in the Antilles, offered visitors from France classic Parisian dishes adapted to the climate and the availability of herbs and spices unknown to France: these, so strict is French naming, could not be called what she called them. She might have cooked a chicken in red wine, but it was not really coq au vin.

British forces have seized vital high ground about 10 miles west of Stanley, the capital of the Falkland Islands, after only moderate fighting, military sources said tonight. The sources disclosed that paratroopers and Royal Marines had ousted Argentine soldiers manning small outposts on the summits of 1,504-foot Mount Kent and adjacent hills, from which Stanley is clearly visible in good weather. The hills form a sharp ridge overlooking a featureless plain leading to the capital and would give the British valuable positions for observation and possibly for artillery. British control of the whole ridge would expose enemy forces, bottled up on a thin finger of land jutting into the South Atlantic, to 105-millimeter howitzer fire from one direction and 4.5-inch naval gunfire from the other.

The shortage of priests in the Roman Catholic Church, a growing problem worldwide for a decade, will soon reach crisis proportions in the United States, researchers say. Their figures indicate that the Catholic Church in this country will have 50 percent fewer active clergymen by the end of the century than it has today. Seminary enrollment continues to decline, despite recruiting efforts. In 1966 there were 48,000 seminarians, and in 1972, there were 22,963. Now there are 11,500, according to statistics that The Official Catholic Directory is to officially release tomorrow. This number is down 800 from last year and not all those now enrolled will finish their three years or more of seminary studies and be approved for ordination. According to the directory, there are now 58,085 religious and diocesan priests in the United States, 315 fewer than last year. Researchers at the National Opinion Research Center of the University of Chicago predict there will be fewer than 25,000 priests in the United States by the end of this century.