URGENT Seven Nations Settle Poland's Border Dispute with West Germany With AM-Germany-Soviet, Bjt

PARIS (AP) _ The seven nations negotiating German unification reached a historic agreement Tuesday on Poland's permanent border and cleared the way for the merger of East and West Germany by year's end.

Secretary of State James A. Baker III declared the Bush administration was pleased with the results of the session, held in an international conference center yards from the Arc de Triomphe, where German troops marched into Paris in victory 50 years ago last month.

Today's German leaders agreed to give up any claim to territory absorbed by Poland at the end of World War II and to make that commitment part of the new Germany's constitution.

''All agree that a unified Germany will consist of the Federal Republic of Germany, the German Democratic Republic and Berlin - no more, no less,'' Baker said.

''We are very happy with the results,'' Polish Foreign Minister Krysztof Skubiszewski said. ''The border has been confirmed.''

Poland, which lost 6 million people in World War II and barely survived as a nation, had been concerned that its powerful neighbor once again would start eying Polish territory, about one-third of which was part of pre-war Germany.

The treaty to be signed by the new Germany with Warsaw shortly after unification will accept the border the Allies set between Poland and East Germany in 1945.

The virtually simultaneous acts of German unification and concluding a border treaty with Poland will be followed by the four wartime allies - the United States, the Soviet Union, Britain and France - giving up their control of Berlin and other occupational powers held since 1945.

''We are keeping to the pace necessary to complete our work,'' Baker said.

The actions were announced at a news conference after talks involving the two Germanys, Poland, and the four World War II victors.

The path to German unity was largely cleared in Moscow on Monday when Soviet President Mikhil S. Gorbachev agreed to Germany's membership in the North Atlantic Treaty Organization and removed virtually all other obstacles to merger.

The Bonn government also agreed on Tuesday to talks with Poland this summer designed to assure Warsaw that its contract with East Germany will be fulfilled after unification. The talks could result in German assistance to Poland's shaky economy.

A senior U.S. official, who spoke on condition of anonymity, said the agreement removes any possibility a peace treaty would be prepared that would legally confirm the end of World War II.

''It certainly seems dead as a doornail,'' the official said, adding:

''Germany will give up any claim to land now held by Poland and will state it has no territorial claim to any other nation's land.''

''Today will go down in history as the day in which the Polish border has been settled to the satisfaction of our Polish friends,'' Eduard A. Shevardnadze, the Soviet foreign minister, said.

Baker said the seven nations had established a ''sound basis for European security and stability.''

On the planned economic talks, Skubiszewski said West Germany was ''fully understanding'' of Poland's economic plight. He declined to give details of the talks, which he said might also involve East Germany.

Another result of the successful third round of the ''two-plus-four'' talks, to which Poland was added, is the increased likelihood of a 35-nation summit meeting in Paris in November. However, the United States has insisted on completion of a treaty beforehand to reduce U.S. and Soviet troops, tanks and other non-nuclear weapons in Europe.

Those talks now are being held in Vienna between NATO and the Warsaw Pact.

On Monday, in the Soviet region of Stavropol, Gorbachev and Chancellor Helmut Kohl of West Germany also agreed to limit the army of a united Germany to 370,000 men.

The two Germanys now have about 600,000 men under arms, with 480,000 in West Germany.

The Soviet Union and West Germany also agreed to begin negotiations on the full withdrawal of Soviet soldiers from what is now East German territory. The 380,000 soldiers should be pulled out in three to four years.

West Germany - the richest nation in Europe - is expected to increase trade with Moscow. It has already backed a $3 billion bank loan to the Soviet Union and pushed its allies for a comprehensive plan to bail out Gorbachev's crumbling economy.