Russia has signed a deal to import Australian uranium for Russia's nuclear energy program. The two countries were quick to assure the world that the material would be used only for peacetime nuclear purposes. Nancy-Amelia Collins reports from Australia's largest city, Sydney, where the Russian president has joined the leaders of 20 other economies for the annual Asia Pacific summit meeting.

Vladimir Putin, fourth from left, and John Howard, third from right, look on during signing of agreement in Sydney, 07 Sep 2007

Russian President Vladimir Putin signed the deal with Australian Prime Minister John Howard Friday, as the two prepared for the upcoming APEC summit.

While the deal states Russia cannot sell the Australian uranium to any other nation or use it to make weapons, critics have said the deal might make it easier for rogue third countries or groups to obtain the raw material needed to make a nuclear weapon.

The Australian Prime Minister quickly denied suggestions that the agreement poses a potential nuclear threat.

"Any uranium that is sold to Russia will be sold subject to very strict safeguards, and the (Russian) president in our discussion made the point that I think is relevant, that Russia already has an enormous amount of military nuclear material, which it is selling principally to the United States for reprocessing. So if you apply logic to the allegations, it lacks substance," Mr. Howard said.

In a 1993 agreement with the United States, Russia promised to convert 500 metric tons of highly enriched uranium left over from Soviet nuclear weapons programs. The Russians were to process the material into lower-quality uranium, to be used as fuel for American nuclear power plants.

President Putin stressed that Australian uranium would be used by the Russians solely for the production of peacetime energy.

"In terms of Australian uranium, we will buy it only given our plans to develop peaceful nuclear energy," Mr. Putin noted. "In the Soviet era we built about 30 big power units on the nuclear power plants. In 15, 20 years we are planning to build this same amount, and for these purposes and only for these purposes we need this Australian uranium."

Mr. Putin, the first Russian president ever to visit Australia, arrived in Sydney a day after signing a billion-dollar arms deal with Indonesia. Under that agreement, Russia is providing a line of credit for Jakarta to buy tanks, helicopters, and submarines.

Mr. Putin and Mr. Howard will be among 21 leaders, including U.S. President George Bush and Chinese President Hu Jintao, at the annual Asia Pacific Economic Cooperation summit here on Saturday and Sunday.