BEIJING - China's muted response to North Korea's nuclear brinkmanship reflects the dilemmas dogging Beijing as it seeks to coax Pyongyang back to disarmament talks while fearing for the health of Kim Jong-il and his regime.

Even for typically tight-lipped China, its reaction to the latest confrontation over its neighbor's nuclear ambitions has been guarded, and analysts say it is likely to remain reserved unless Pyongyang threatens a second atomic test.

After North Korea said on Tuesday it would not return to the six-party disarmament talks hosted by Beijing and would step up its nuclear activities, China's Foreign Ministry avoided any word of criticism, instead urging all sides to show restraint.

The People's Daily, an official paper of the ruling Communist Party, on Wednesday carried a brief report on Pyongyang's nuclear announcement, and a long one lauding North Korea's high tide of coal production.

China's long-standing fear of riling North Korea has been intensified by worry about its leader, Kim Jong-il, who has looked haggard in recent public appearances, and what could follow his demise, said Cai Jian, an expert on Korea at Fudan University in Shanghai.

China is in a quandary in dealing with North Korea and it's become deeper, said Cai. Strong action against North Korea could have the result opposite from intended and produce worse conflict, even chaos ... But if we give too much support to North Korea, we face criticism and pressure on us. North Korea knows it can exploit this dilemma and that makes things worse for us.

Washington, Tokyo and other regional capitals are likely to urge Beijing to pressure North Korea to reverse its threats. China exports vital energy and food supplies to the impoverished North that could be used for pressure.

The bottom line is that this comes down to China as the key. They have the most influence over North Korea, said Peter Beck, an expert on the North at American University in Washington.

Beck cited views in Washington that if we take a hands-off approach, China will have to get more hands on.

RISK OF INSTABILITY

But such arguments are unlikely to persuade Beijing.

China opposed a proposed U.N. Security Council resolution censuring North Korea for its April 5 launch of a rocket, which other nations called a missile test. But on Monday, it compromised, supporting a Council statement condemning the secretive state's launch.

Now, in the light of North Korea's angry response to that statement, China is likely to feel its initial caution was vindicated and will be reluctant to apply heavy pressure.

China is very concerned about North Korean political stability, said Cai, the Shanghai-based expert. External pressure could threaten that stability, and there's the risk of factional struggle in a succession process leading to chaos.

The demise of Kim, 67, could unleash strife over control of the secretive one-party state, with the potential for dangerous conflict among party and military groupings over command of the country's small nuclear arsenal.

China's 1,420-km (880-mile) border with the North is also a brittle barrier against millions of potential refugees who could surge across if the North slides into turmoil.

Beijing's stake in stability and a modicum of influence in the North will deter the government from choking off food or energy flows to its needy neighbor, said Zhu Feng, a regional security expert at Peking University.

The situation (in North Korea) is looking very uncertain and I don't think it would be wise to cut off provisions, said Zhu. China is also unclear about what forces will drive North Korean behavior when Kim Jong-il is ill. Rash actions could backfire.

Instead, Zhu said, Chinese officials hope for a conciliatory proposal from the Obama administration that could draw Pyongyang back to talks, and they are also exploring fresh formats for negotiations outside the six-party talks Beijing has hosted since 2003 -- a trophy of growing Chinese diplomatic stature.

Those on-again, off-again talks brought together North and South Korea, host China, the United States, Japan and Russia.

If Pyongyang threatens another nuclear test, Beijing will probably reach for the harsher language and pressure it applied in 2006, Cai said.

But for now China will wait and see if Washington will offer something new to Pyongyang. They know that at some point, Washington will have to reach out to North Korea, said Beck.

China