Obama agrees arms cuts, Afghan transit with Russia

By Matt Spetalnick and Oleg Shchedrov

MOSCOW (Reuters) - Visiting President Barack Obama and Kremlin leader Dmitry Medvedev agreed a target for cuts in nuclear arms and a deal to let U.S. troops fly across Russia at the start of a trip intended to mend strained ties.

At a cordial, formal news conference in the Kremlin's vast, gilded St Andrew's Hall, the two leaders spoke of their resolve to put differences behind them and focus on cooperating to solve global problems such as the spread of nuclear weapons.

Both mentioned the issues that still divide them -- Russia's opposition to Washington's plans for a missile defense shield in central Europe and U.S. insistence on Georgia's territorial integrity -- but stressed the positives in public.

Obama praised Medvedev as a "straightforward, professional" leader who understood the interests of the Russian people and wanted to understand those of the United States, adding:

"We have resolved to reset U.S.-Russia relations so that we can cooperate more effectively."

At a signing ceremony, Obama and Medvedev, wearing identical dark suits, white shirts and red ties, pledged to finalize a treaty by year-end to cut the number of deployed nuclear warheads on each side to 1,500-1,675 from levels above 2,200.

Details of the arms deal were open until the night before Obama's arrival, with negotiators on both sides working through the weekend to secure agreement.

Medvedev described their talks as "very useful and open, businesslike conversations" and said they would aim to build a U.S.-Russia relationship worthy of the 21st century.

Russia will allow 4,500 flights a year carrying U.S. troops and weapons to the war in Afghanistan to cross its vast territory free of charge, a move hailed by the U.S. side as showing Moscow's willingness to help in the war on the Taliban.

Other accords covered the resumption of U.S.-Russia military cooperation, the creation of a new joint government commission, and an exchange of information on prisoners of war, according to texts released by officials.

Clouds remain on the horizon.

Senior Russian officials repeatedly emphasized in the run-up to the visit that Moscow would not sign an arms treaty later this year unless Obama made concessions on Bush-era plans for an anti-missile system in Europe, a project hated by the Kremlin which fears it could threaten Russia's security.

Obama has ordered a review of the project and the leaders played down their differences on it at the Kremlin, saying they had agreed a statement to continue to work together to evaluate global threats from ballistic missiles.

Officials on both sides said the statement had not been planned in advance but the two leaders decided to draw it up during their private talks, reflecting their desire to cooperate.

Noting that Obama had listened to Russian objections on missile defense, Medvedev used markedly softer language on the issue than Russian officials have done to date.