With a series of quickly choreographed steps, the United States and China outlined a tentative deal Friday to send a blind legal activist to study in the U.S. and potentially bring a face-saving end to a delicate diplomatic crisis.

The arrangements, if kept, promise to give Chen Guangcheng much of what he wanted: a chance to live with his family in safety and to get a formal legal education. It would also allow Washington and Beijing to put aside a rancorous human rights dispute to focus on managing their rivalry for global influence.

As part of the deal, China's Foreign Ministry said Chen can apply for travel permits to study abroad. The State Department said an American university — later identified as New York University — has offered a fellowship for Chen with provisions for his family.

Spokeswoman Victoria Nuland said the U.S. expects Beijing to process the travel permits quickly, and once done, visas would be issued.

"I don't think this is empty talk here. I think they mean this is a way out, and it's a dignified way out. It's a good way out for the Chinese government and our government and for Chen and his family," said Jerome Cohen, an NYU law professor who met Chen nearly a decade ago, advised him during the negotiations and arranged the fellowship.

Clinton makes careful comments

In a sign that not all was settled, Secretary of State Hillary Rodham Clinton offered a guarded assessment.

U.S. ambassador to China Gary Locke (left) talks on a mobile phone as he accompanies blind activist Chen Guangcheng (right) in a car, in Beijing, May 2. (Reuters)

"Over the course of the day, progress has been made to help him have the future that he wants, and we will be staying in touch with him as this process moves forward," said Clinton, who was in Beijing for annual strategic talks.

"This is not just about well-known activist, it's about the human rights and aspirations of more than one billion people here in China and billions more around the world."

The progress, however, seemed significant after a bizarre, rocky crisis triggered when Chen, an inspirational figure in China's human rights movement, escaped from house arrest in his rural home and reached the U.S. Embassy in Beijing last Friday.

First saying he wanted to stay in China, a smiling Chen emerged from the fortress-like embassy to a hospital reunion with his wife and two children only to say hours later that he changed his mind.

In cell phone calls from his hospital room with friends and foreign media, he said he and his family felt unsafe and he wanted to go abroad, undoing a deal U.S. and Chinese officials worked out to guarantee their safe relocation to a city in China where he could study law.

"My situation right now is very dangerous," Chen told The Associated Press early Friday. On Thursday, he dialed into a congressional hearing to make a direct appeal for Clinton's help.

The drama unfolded but did not derail the two days of talks by Clinton, Treasury Secretary Timothy Geithner and their Chinese counterparts on irritants that bedevil U.S.-China relations, including trade, Iran's and North Korea's nuclear programs, conflict in Syria and cyber-spying.

"This week has shown again that we cannot wall off human rights from our bilateral relationship or relegate it to the margins of our engagement," Clinton said at the end of the talks.

Agreement could face complications

Much could still upend the agreement. A key problem is where Chen and his family would pick up their passports. Returning to their home town, the usual route, would expose them to possible retribution from the same local officials who illegally put Chen and his family under house arrest to punish him for exposing forced abortions and other misdeeds carried out as part of China's one-child policy.

Applying directly to the police ministry, which issues passports, is allowed in some cases.

Authorities could still deny Chen by law if it's determined that he "will undermine national security or cause major losses to the interests of the state."

Patrick Mahoney of the Christian Defence Coalition: 'We call upon president obama to protect Chen Guangcheng and his family.' (CBC News )

"This has been used to deny passports to people who will hurt China's image," said John Kamm, a veteran human rights campaigner. Among those denied passports is Tibetan writer Tsering Woeser.

Chen could not be reached for comment. The cell phone he had used for days was switched off.

Still there were signs that his treatment was improving. After being unable to meet with U.S. officials for the better part of two days, Chen was allowed to meet with embassy staff and an American doctor.

Medical checkups showed his health is good except for three broken bones in his foot suffered when he was escaping from his rural village, a senior State Department official said.

Hospital staff brought his children new clothes, cut their hair and gave his son, Kerui, a present for his birthday, the official said. The son, who lived with relatives during the family's recent house arrest, is believed to be around 10, family friends said, a vagueness that is typical in rural China where birthdays are traditionally celebrated at the Lunar New Year.

At a briefing shortly after the Foreign Ministry said Chen could apply to go abroad, spokesman Liu Weimin also confirmed that Chen faces no pending criminal charges, indirectly acknowledging that the house arrest he and his family endured in their rural home was illegal.

"According to Chinese laws, he is a regular citizen. He can absolutely go through regular formalities by normal means," Liu said.