UPDATE 2-Russian patriarch says religion law must not go too far
* Patriarch Kirill says law should not crimp freedom of speech
* Blasts corruption in Russian Orthodox Christmas eve interview
* Putin, Medvedev attend midnight Christmas services
* Critics warn law may blur state, church in secular Russia
By Alexei Anishchuk
MOSCOW, Jan 6 (Reuters) - Patriarch Kirill, the head of the Russian Orthodox Church and a long-standing ally of President Vladimir Putin, on Sunday urged the Kremlin to be moderate in new legislation seeking stricter punishment for religious offences.
The pro-Kremlin United Russia party proposed a law introducing jail terms for offending religious feelings after a protest against Putin's increasingly close ties with the Church by punk band Pussy Riot in Moscow's main cathedral in February.
Two members of the band are in prison for the protest, which Kirill has called part of a coordinated attack intended to thwart the post-Soviet revival of Russia's dominant church.
In remarks published on the eve of Russian Orthodox Christmas, Kirill, who has likened Putin's long rule to a "miracle of God", told the Interfax news agency that Russia needed stiffer punishments for offences against religion.
"A fine of several hundred roubles (about $10) for blasphemous inscriptions on a church, a mosque or a synagogue signals that society does not fully realise the importance of protecting ... religious feelings of believers," he said.
But in his most extensive comment on the proposed law, he said it should not limit citizens' rights.
"Any regulatory acts regarding the protection of religious symbols and the feelings of believers should be scrupulously worked through so that they are not used for improvised limitation of freedom of speech and creative self-expression."
The remarks were in line with indications that Putin, while wanting to make clear that actions such as the Pussy Riot protest are unacceptable, is wary of undermining the balance between religions in the diverse country.
Political analysts say the Kremlin has rowed back from its initial position on the law to take into account the ethnic and religious balance between the Christian majority and Muslim minority, a precondition for political stability.
Kirill said nothing about what punishment he favoured. As proposed in September, the legislation called for prison terms of up to three years for offending religious feelings and up to five years for damaging religious sites or holy books.
Rights groups say the legislation could blur the line between church and state in constitutionally secular Russia.
PUTIN AND PATRIARCH
Putin, a former Soviet KGB officer, has cultivated close ties with the Russian Orthodox Church in 13 years in power and has leaned more on it for support since starting his third term as president in May following protests against his rule.
Prime Minister Dmitry Medvedev and his wife, Svetlana, attended a Christmas service led by Kirill and shown live on state TV at Christ the Saviour cathedral, the scene of the Pussy Riot protest. Putin went to a midnight service early on Monday in the Black Sea city of Sochi.
Opponents say the draft law is intended as part of broader Kremlin moves to suppress dissent and bolster public support by casting Putin as the protector of religious believers.
Critics have also said the definition of offending religious feelings is so broad and vague in the draft law that it risks being ineffective or applied selectively.
The Russian Orthodox Church has been resurgent since the collapse of the Soviet Union in 1991. About three in four of Russia's 143 million people call themselves Russian Orthodox, though only a minority attend church regularly.
Many were offended by the Pussy Riot protest, and opinion polls suggested that most Russians believed the two-year prison sentences two of the women are serving are fair punishment.
Kirill, who did not mention the punk protest - which the band said was an anti-Kremlin stunt not aimed at offending believers - urged peaceful responses to anti-church "incidents".
"The key thing is that resistance to blasphemy should be appropriate and free from aggression," he said.
Kirill also offered support for Putin's battle against graft, declared in a public address last month.
Critics of the Kremlin say corruption has flourished under Putin, with Russia ranking 133rd out of 174 states, alongside Honduras and Guyana, in the Corruption Perception Index compiled by Transparency International.
Kirill has dismissed media reports of a lavish lifestyle; the Church apologised in April for doctoring a photograph of him to remove what bloggers said was a luxury wristwatch.