WASHINGTON--President Reagan declared today the United States must give Nicaragua's Contra rebels "what they need to survive" and said prospects for peace in Centra America depend on keeping pressure on the leftist Sandinista government.

Reagan, in a speech to his Cabinet and more than 1,000 political appointees, said the final year of his presidency will be "the year that the United States will strongly affirm that democracy, not communism, is the future of Central America."

The administration faces an uphill struggle winning congressional approval for more aid to the Contras, particularly in view of concessions announced over the weekend by Nicarguan President Daniel Ortega.

The administration contends that Ortega's offer to restore suspended civil liberties is merely a smokescreen designed to undercut the U.S.-backed Contras and fool Congress as a vote nears on renewing military aid.

Hours earlier, leaders of the Democratic fight against renewed aid to the Contras said a new infusion of military supplies would escalate the Central American conflict "with results we could neither predict nor control."

Rep. Lee Hamilton (D-Ind.) predicted that the February 3 House vote on renewing military aid will be close because Reagan "will pull out every stop to win."

But if the House should vote to extend Contra aid and the Senate should follow suit the next day, Hamilton said, "the effect would be a continuation of the war and an escalation of the war, with results we could neither predict nor control. It would also mean the...peace process would come to a halt."

Rep. Tony Coelho (D-Calif.) the chief vote counter for House Democrats. said the margin for the showdown vote remains razor-thin, with a group of 30 to 50 members considered crucial.

Those members will, in turn, be heavily influenced by whether Nicaraguan President Daniel Ortega lives up to his weekend promises immediately to restore civil liberties and engage the Contras in direct cease-fire talks, Coelho added.

Reagan, in his speech, did not mention Ortega's weekend offers.

Hamilton said he would work to persuade colleagues that by voting against Contra aid, lawmakers would be casting their lot with a political process that could bring an end to the region's long conflicts.

"It's by no means a risk-free choice," Hamilton said, but recalled the plea of Costa Rican President Oscar Arias, author of the peace plan, that Congress "take a risk for peace." The five-nation peace agreement was signed Aug. 7.

The Reagan administration has announced its intention to request a renewal of aid on Jan. 26, and top administration officials have dismissed Ortega's promises at a weekend regional summit in Costa Rica as a ploy to fool Congress and undercut the rebels, who have become Reagan's top foreign policy priority.

At the same time, Sen. Christopher Dodd (D-Conn.) said the administration has decided to sit out the peace process because it is at odds with the president's goal of eliminating the Sandinista regime from Nicaragua.