AFTER more than 150 hours of Sino-British talks to map out a blueprint for Hong Kong's future system, pragmatism has won over rhetoric in charting the course for the negotiations. Observers fed up with the war of words between China and Britain over sincerity perhaps were anxious to see some sort of dramatic announcement from the British cabinet which held a crucial session on Wednesday to decide on the negotiating strategy recommended by Governor Chris Patten. To their disappointment perhaps, but to the delight of many others, Britain, after the hour-long cabinet committee meeting, declared its willingness to use up its last ounce of patience to strike a deal on the 1994/95 elections and wait if necessary until the deadline for pressing the button and setting the legislative process in motion arrives. Foreign Secretary Douglas Hurd announced no deadline on tabling the electoral bill nor did he suggest any concrete date for ending the talks. Instead he said Britain was now ready to separate the discussions on the 1994 and 1995 electoral arrangements, although he still stressed that ''only weeks rather than months'' were left to conclude the negotiations. This step is being taken following indications that Beijing is prepared to offer some concessions on issues directly related to the 1994 district board elections such as lowering the voting age from 21 to 18 and the abolition of appointed seats of the district body. Openly, China has always warned against Britain imposing any deadlines on the talks so as to pressurise Beijing, but action is always more telling than words. The signal of concessions - no matter how small - offered by Beijing in the last round of talks, held only days before the crucial cabinet session, is sure evidence that Chinese leaders are not insensitive to the British claim on the time table. When the talks enter their 16th round next Friday, the two sides are likely to try to seek a compromise on the voting age, the district board appointed seats and the single-seat-single-vote election method. Although China greeted the cabinet decision with caution, the latest turn of events has raised hopes that even though a full accord may be missing, a partial agreement is on the cards. A Chinese official said: ''It appears that there is still room for negotiation . . . But it could also be interpreted as a way to pave the way for a breakdown by laying the blame on the Chinese side.'' China will face the tough choice of making concessions on the three less contentious issues before a full accord is reached or there is a possible breakdown of talks should it decide to reject the British proposals. A source close to Beijing said: ''The tricky point is that concessions on minor areas always depend on whether there are signs for agreement on major issues.'' It would be too simplistic to say Britain's latest switch of tactics amounts to a kowtow from London to China because British officials are no longer issuing utimatums or deadlines. They are also willing to separate the talks on the 1994 and 1995 polls, something which they have persistently rejected over the last 12 months. Instead, they have come up with a clever move in shifting the pressure on to the Chinese side - perhaps into a win-win situation for British officials. Superficially, Mr Hurd's offer to separate the talks by dealing with the easy subjects of 1994 polls first and the difficult ones, such as the through train arrangements, later is the same as the proposal advocated by Foreign Minister Qian Qichen last month. A fundamental difference between the two offers, however, is Britain's intention that such a step should be reciprocated by a speedy agreement from Beijing - if not from next week's talks, then from the next couple of rounds of meetings - on Mr Patten's proposals on voting age, voting method and abolition of district board appointed seats. The leaders in Zhongnanhai may have a rather different time table and will not want to rush into any accord, even a partial one, with Britain. Having put the offer to Chinese officials, Britain can expect two possible outcomes. One is an outright rejection of the British offer and the other scenario is that Beijing will heed London's call and lend its support to the 1994 electoral package and move into an intensive phase of talks to discuss the controversial through train issueand the arrangements for the Legislative Council functional constituency and election committee polls. If China's response to the offer of a speedy agreement is less than enthusiastic, British officials can then argue with a louder voice that it has exhausted every possibility to facilitate an accord. China, in their eyes, will be to blame for not co-operating on the very ''straight-forward'' issues for the 1994 polls. Any positive response from Beijing, however, will mean that at least a mini-accord would be achieved on the 1994 electoral plan and Britain can be clear of the risk of having the district board members elected in 1994 invalidated by Beijing in 1997, a warning Mr Qian has delivered under a no-deal scenario. An added advantage of a mini-agreement is a reassuring message that if the two sovereign powers are working rationally and realistically on matters they can agree on, the two sides may agree to disagree on the more difficult subjects. This can be seen as a damage-control plan to ensure the shock to Hong Kong would be minimal. Cynics may say that Britain has indulged in many deliberate leaks to minimise possible damage and pre-empt any adverse action from Beijing. Quoting sources, the Observer newspaper said last weekend that China has mapped out a hit-list of British firms who would face economic sanctions if the political talks collapse. Among those were Cable & Wireless and Jardines. The Financial Times, in a despatch from Hong Kong, reported on the eve of the cabinet meeting that mainland officials have dropped a hint to the British chief negotiator Sir Robin McLaren that China was ready to compromise on the three less contentious issues at the upcoming 16th round. Both reports were denied by mainland officials. Untrue though the reports may be, the British side has secured an assurance from Beijing that British firms would not be singled out for punitive economic measures. On the decoupling of talks, Britain will also be seen to be taking another initiative by pushing hard for a deal within the limited time frame. China's desire to contain the damage if the two sides drift apart is also evident, even though the threats and promises have continued. Senior officials adopted soft tactics to keep talks going on one hand, while firing veiled threats and direct warnings to Britain under a no-deal scenario. For instance, a Preliminary Working Committee sub-group decided at a meeting early this month that they would treat the formation of the first post-1997 legislature as their first priority as soon as political talks fail. The PWC, a think tank for the Special Administrative Region Preparatory Committee, will speed up work if Sino-British co-operation on the political front breaks down. Informed sources said the State Council departments are looking into specific measures to minimise damage to the economy of Hong Kong as part of the so-called ''preparations by both hands'' - meaning that they are preparing two plans to cope with different scenarios. Various sources believe that it is too early to say that China has already compiled a detailed contingency plan if the talks break down. More signs are emerging that Beijing is now resorting to greater pragmatism in dealing with Britain. China is said to be likely to seek the maximum degree of co-operation with Britain particularly on the economic front even though both sides may want to agree to disagree in the political arena. For Hong Kong people, this is the second best option. Ultimately, to ensure a smooth transition in 1997, the best case for the six million population is for the two sovereigns to exercise maximum flexibility and pragmatism to see eye to eye on every subject. Notwithstanding the political tug-of-war of the past year, the ability of the two sides to overcome the hurdles blocking efforts to achieve a deal on the 1994/95 electoral plan shows that where there is a will, there is a way. The next couple of months will be the most critical period for the constitutional talks. It will also be a testing period in which the leaders from the two countries can demonstrate their tact and their will to fulfil the promise of a prosperous and stable Hong Kong.