Russia signs peace pact with Mongolia

Mongolia was a Soviet satellite state for 70 years

Russia and Mongolia have agreed never to attack each other or sign any international agreement harmful to each other.

There have never, and never will be unsolved problems between Russia and Mongolia

Vladimir Putin

Russian President Vladimir Putin and Mongolian leader Natsagiin Bagabandi signed a military pact on Tuesday, as well as pledged to revive trade links.

"There have never, and never will be unsolved problems between Russia and Mongolia," said Mr Putin, who was given a warm welcome during his two-day visit to the Mongolian capital Ulan Bator.

Mr Putin was given a warm welcome

"We are linked by many years of close co-operation."

The pact also committed both sides to maintaining Mongolia's status as a nuclear weapons-free zone - seen as a reassurance for Mongolia's other powerful neighbour, China.

The BBC Moscow correspondent says Russia is keen to reassert its influence over its south-eastern neighbours, in an effort to counter Chinese and American influence in the region.

This is the first visit to Mongolia by a Russian head of state in 26 years.

Trade talks

The two countries agreed to revive trade between them after a five-year slump in what was once booming trade.

The poor economy has hit ordinary people

For more than 70 years, Mongolia was dependent on subsidies from Moscow, which sharply withdrew aid from the country after the Soviet-backed government in Ulan Bator fell in 1990.

A plan for a gas pipeline linking Asia with Russia through Mongolia as well as the metal industry and agriculture were discussed.

Mongolia has suffered a painful economic crisis in recent years and earlier this year, a severe winter devastated the country, wiping out livestock which many nomads depend on.

Mr Putin said Mongolia was a key link in Moscow's drive to boost ties with its Asian neighbours.

"Our total participation in co-operation in Asia and the Pacific Ocean is natural and inevitable," he said.

The Russian leader left Ulan Bator on Tuesday for a summit of the Asia Pacific Economic Co-operation group in Brunei - a trip which observers see as part of a Kremlin drive to balance Moscow's foreign policy between Asia and Europe.