FOUR hundred years on, Shakespeare's Merchant of Venice continues to

stir up all kinds of controversy. In America the play with its dicey

portrait of Shylock, the Jewish merchant, is now considered too racially

sensitive and is on the proscribed list.

John Barton's 1980s production left its audience in no doubt as to the

cruelty of the alien community in which Shylock found himself. Even the

estimable Portia and her Belmont playmates had question marks hanging

over them by the end: a spoilt and spiteful lot.

David Thacker's production, by comparison, asks fewer racial questions

though digs deeper in gender terms befitting a realignment of the play

in Thatcher's Britain and Portia (Penny Downie) very androgynous and

trim in pinstripesuit.

David Calder's Merchant, in his braces and smart suit, is the typical

kind of successful city dealer marking him out as any one of the tribe

of ''assimilated'' British Jewry who have taken their place in Britain's

cultural life. Calder is outstanding at this point in the game (though

less convincing later).

With its themes of probity, persecution and racial integrity, this

production demands to be seen more, not less.