Vladimir Putin: Dear Mr Prime Minister, ladies and gentlemen. We are happy to welcome you to Moscow.

This is the first visit by a Lithuanian Prime Minister to Russia and the first meeting between Russian and Lithuanian heads of government in the past six years. Nevertheless, overall trade between our countries has been quite significant in recent years. After all, $5.5 billion is not a small figure for Lithuania. Unfortunately, trade has fallen somewhat as a result of the economic downturn, but even today it stands at approximately $4.5 billion.

Large Russian companies such as Gazprom, LUKoil, and RAO UES are doing business in Lithuania. We need to resolve some issues of mutual concern to Russia and Lithuania. We are very glad that you are in Moscow today, and we can discuss all these issues in person.

I am talking about infrastructure projects and energy issues. I am aware of the reservations that some of our colleagues have voiced about nuclear energy projects in north-western Russia, specifically in Kaliningrad. We are ready to discuss all of this with you, go over all the issues of concern, and provide necessary explanations. And of course, if there are any areas of common interest, we are ready to consider them. What I mean is identifying those areas of cooperation that are of mutual and common interest to our countries.

Welcome!

Andrius Kubilius: Thank you, Mr Prime Minister. Thank you for the opportunity to meet with you and for the very warm welcome. We were surprised to see that all the streets were empty. Thank you, truly. We appreciate this opportunity to meet and discuss all the important issues on our bilateral agenda. Thank you very much!

We welcome the opportunity to discuss the issues that are vital for our countries. The economy and related issues are probably the most important, especially now, following the global financial crisis. We came through last year's difficulties and our economy is becoming more or less stable.

As an open economy, Lithuania is interested in expanding bilateral trade relations with Russia. Russia is a very important import and export partner for us. We would like to thank you for resolving the problems regarding dairy products, cheeses and other such products.

We believe that our products are of excellent quality, and we know that they are in demand in Moscow, St Petersburg and other Russian cities. Thank you for this decision. I think we can find ways to increase trade in this area.

There are also a number of promising opportunities in the energy industry. We are developing our energy industry. We are interested in developing independent means of generating power and in integrating with European power grids. These issues are of strategic importance for us and we have a long-term development strategy for this industry. And of course, cooperation with neighbours is a very important part of our strategy.

As you know, we closed the Ignalina Nuclear Power Plant under an agreement with the European Union.

Vladimir Putin: You were forced to.

Andrius Kubilius: Anyway, it is good that we can close nuclear power plants with their financial assistance. We are developing plans to build new facilites on the same site. Experts believe that this will reduce construction costs by some 30%. By the middle of this year we will have a new strategic investor as a result of an international tender.

We have clear strategic objectives, and we have a clear vision of what we want and what we are doing.

In addition, we are interested in discussing gas supplies. We follow developments in the global gas industry very closely, and we plan to construct an LNG terminal either in Lithuania or jointly with other Baltic states.

We believe that Gazprom will consider global gas trends and improve its pricing policy. So, thank you very much again for this great opportunity to discuss all these issues.

Vladimir Putin: We could also discuss our cultural partnership. I understand you have been invited to a concert in memory of the great Russian musician, Mstislav Rostropovich.

We have always had a great interest in Lithuanian culture. This is our traditional interest. Not just your dairy products, your culture too. I think we should consider how to proceed in this area.

I am also interested in sports. In my young years I once won Lithuania's open sambo championship, and I have first-hand knowledge of the history of sports between our countries. There is a lot that could and should be restored.

Andrius Kubilius: We would be happy to see you at the meeting of the Baltic Council of Ministers on June 1-2. Yesterday Ms Merkel confirmed that she would attend.

It's not a sambo tournament of course, but we could probably organise one.

Getting back to culture, my family knew Mstislav Rostropovich very well. He conducted the orchestra my wife plays in. We can share his glory, so to speak, since his great-great-grandparents were of Lithuanian descent.

Vladimir Putin: You know, if you dig deep enough in our ancestry, you can find anything.