US:Russian president Vladimir Putin has made a fresh proposal to resolve his country's dispute with the United States over a proposed missile defence system Washington wants to base in Poland and the Czech Republic.
During talks with president George Bush at the Bush family retreat in Kennebunkport, Maine, Mr Putin expanded an earlier counter-proposal to base the system in the former Soviet republic of Azerbaijan.
Mr Putin proposed incorporating a radar system in southern Russia and bringing more European nations into the decision-making process about how the missile shield is structured. He suggested information-sharing centres in Moscow and possibly Brussels as a way to strengthen the security relationship between Moscow and Washington.
"We support the idea of consultations on missile defence and believe that the number of participants should be expanded to include the European states. This should be done within the Russia-Nato council," Mr Putin said.
Mr Bush described the proposal as "very sincere" and "very innovative" but he failed to budge on the idea of siting part of the system in central Europe, which Moscow views as provocative.
"I think the Czech Republic and Poland need to be an integral part of the system," Mr Bush said.
Washington claims the missile defence system is intended to counter threats from countries such as Iran, which the US regards as "rogue states". Moscow argues that, if this is the purpose of the shield, Azerbaijan would be a more appropriate site.
The two leaders sought to present a united front on United Nations negotiations with Iran over that country's nuclear ambitions, although it was unclear if Mr Putin had agreed to support the US in imposing tougher sanctions on Tehran. "When Russia and the United States speak along the same lines, it tends to have an effect and therefore I appreciate the Russians' attitude in the United Nations. We're close on recognising that we got to work together to send a common message," Mr Bush said.
The UN Security Council has told Iran it will not impose new sanctions if Tehran stops expanding its uranium enrichment activities but the Iranian government has not yet responded to the proposal.
The meeting between Mr Putin and Mr Bush, which is being hosted by Mr Bush's father, former president George HW Bush, comes as relations between Moscow and Washington are at their most fraught since the end of the cold war.
Mr Bush said he trusted Mr Putin despite their differences on policy and praised the "amazing transformation" that is taking place in Russia. "Is it perfect in the eyes of Americans? Not necessarily. Is the change real? Absolutely. And it's in our interests, the US interests, to have good, solid relations with Russia and that's what Vladimir and I have worked hard to achieve," Mr Bush said.
National security director Stephen Hadley said the two countries had reached a civilian nuclear co-operation agreement, which will be signed today by secretary of state Condoleezza Rice and Russian foreign minister Sergey Lavrov. It assures countries that want peaceful nuclear power programmes that they will have the support of the international community as long as they do not contribute to nuclear weapons proliferation.