"We are against using ecological problems as part of a competitive fight," he said at a press conference with his Finish counterpart Tarja Halonen in Naantali, southern Finland. "As soon as we launch a big, competitive project in Russia, ecological problems are brought up."

Putin also used the occasion to denounce what he said was discrimination against ethnic-Russians in the ex-Soviet Baltic countries, but failed to win the support of Halonen on either issue.

Protection of the ecology in the Baltic Sea has often been a matter of dispute between Russia and the European Union. There is opposition in Finland to Russian plans to build new ports on the Baltic.

Halonen said Finland had paid attention to the criticism of ecological defence groups and thus ensured that its new port of Vuosaari, near Helsinki, was "one of the most modern in Europe."

Meanwhile, Putin said he approved of Finnish funding of ecological projects and cultural programmes for ethnic Fino-Ugrians as long as "the funds are used for the declared uses." However, for the second time in three weeks, he warned "against the financing of political activity by just any channel."

The warning came amid a hardening official stance in Moscow toward non-governmental organisations -- a policy, analysts say, that reflects Kremlin worry about the influence of foreign-funded organisations in the peaceful revolutions that shook Georgia in 2003 and Ukraine last year.

There were also signs of friction over the issue of ethnic-Russians in Latvia and Estonia, which received Finland's diplomatic backing for entry into the European Union. In the second half of next year, Finland will hold the EU chairmanship.

Putin said the non-citizen status of some Russian speakers in the Baltics was "absolutely unacceptable." However, Halonen argued that Latvia and Estonia "respect the norms" in Europe by demanding certain conditions before granting citizenship.

Some Russian speakers in the Baltics still hold Soviet passports and have opted to be classified as having no citizenship in order to avoid having to apply for visas each time they visit Russia. Others have been refused passports after refusing or failing to pass local language tests.

Despite the disagreements, Putin and Halonen meet regularly and will hold further talks in Saint Petersburg later this year. Putin recalled "an excellent evening" spent with Halonen's husband in a Finnish sauna.

On the hot domestic political issue of whether he will step down at the end of his second term, as required by the constitution, in 2008, Putin said: "Perhaps I would like (a third term), but the constitution does not allow it."

"The most important thing is to respect constitutional norms to guarantee stability in the country," he added.

As the end of Putin's term approaches, speculation is growing in Russia that he will seek to change the constitution, or engineer a succession by someone from his entourage. Putin has promised on several occasions to step down on schedule.

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