Putin says Russia has nothing to fear from China

* Putin says China has no need to populate eastern Russia

* Says Russia will supply China the resources it needs

* Putin says China does not want to aggravate ties

By Andreas Rinke

SOCHI, Russia, Sept 6 (Reuters) - Russia has nothing to fear from China and worries that millions of Chinese will some day occupy vast swathes of Russian territory in the Far East are overblown, Prime Minister Vladimir Putin said on Monday.

China and Russia say their trade and political relations are better than ever, though senior Russian officials are privately concerned about an increasingly assertive China along Moscow's vast and largely empty southeastern border.

China, the world's fastest growing major economy, has sought to secure long-term oil and gas supplies from Russia, the world's biggest energy producer, which has a population of 142 million compared to China's 1.3 billion.

"There is no threat on the side of China. We have been neighbours for hundreds of years. We know how to respect each other," Putin told Russia experts from the Valdai discussion group at a meeting in the Black Sea resort of Sochi.

"China does not have to populate the Far East to get what it needs - natural resources. We deliver oil and gas. There are huge coal reserves near the Chinese border. China does not want to aggravate the situation with us," Putin said.

Russian leaders court Beijing and President Hu Jintao held several hours of talks with Putin, including private one-one-one negotiations and a dinner at Putin's country retreat in May.

Putin opened a pipeline last month to carry Siberian oil to China and Moscow is keen to diversify its client base away from dependence on Europe by sell more oil, gas and metals -- Russia's biggest exports -- to China. [ID:nLDE65I04B]

But behind the warm phrases of support for closer ties, many Russian policy makers are increasingly anxious about China's rise as a world economic and political power.

Projections by Goldman Sachs show China could supplant the United States as the world's biggest economy by 2027.

China's economy grew by about 8.7 percent to $4.9 trillion last year while Russia's economy shrank 7.9 percent to $1.23 trillion after a 10-year economic boom, according to International Monetary Fund data.

Russia's economy is growing again but senior policy makers are concerned by the influence China wields over the global energy and commodity markets which drive the fortunes of the Russian economy.

Putin said the development of Eastern Siberia and the Far East was a priority for Russia and that he hoped cooperation with China would deepen.

"It is no secret that this is an enormous territory, an under populated territory which has massive potential," he said.

Some economists say the rise of China could help drive the development of Russia's Far East by forcing investment into an area where population density in some areas is less than 2 people per kilometre compared to 50-100 people per km just over the border in China. (For a story on Putin's comments about Russia's 2012 election, please click on [ID:nLDE6851NJ]) (Writing by Guy Faulconbridge)