* Merkel to visit Moscow on Friday, meet Putin
* German lawmakers want her to press Putin on human rights
* Relations chilly although economic cooperation strong
By Darya Korsunskaya and Timothy Heritage
MOSCOW The Kremlin denounced a rise in anti-Russian rhetoric in Germany on Thursday before a visit by Chancellor Angela Merkel and made clear that Vladimir Putin would stand his ground if she lectures him on human rights.
Merkel is expected to carry out a request by Germany's parliament to press Putin on Friday over what critics call a crackdown on dissent since his May return to the presidency.
Kremlin spokesman Dmitry Peskov signalled that Putin would defend his position and, despite intensifying talk of a chill in relations, said that economic ties were strong enough to ensure Russia's relationship with Berlin stays on track.
"We are well aware of the heightened anti-Russian rhetoric in Germany in recent weeks or even months. We are aware of the demands Mrs. Merkel faces from Bundestag deputies and others to raise various human rights and democracy issues with Putin," Peskov told reporters.
"As always, President Putin will explain in detail whatever remains unclear and will ask his own questions," he said.
Merkel has never enjoyed as strong a relationship with Putin as her predecessor, Gerhard Schroeder, but business and trade ties between their countries have remained close.
Pressure has increased on her, however, to question Putin on human rights following the biggest protests against his rule since he first rose to power in 2000 and the introduction of laws which critics say are intended to smother the opposition.
Criticism of Putin, who served for five years as a KGB spy in Dresden, has fuelled talk of frosty relations between the two European powers, especially as Putin has bristled at what he regards as attempts to teach him about democracy.
Peskov put the increase in anti-Russian sentiment down to what he said was point-scoring at the start of campaigning for Germany's federal election next year.
"We would not wish to see Russian-German relations used in this way because the relationship is unique in its scope, in its diversity and in its very promising prospects," he said.
Expressing faith in the reliability of mutual trade, which he described as a safety cushion, he said: "Eighty-seven billion dollars in (annual) bilateral trade provide this 'air bag'. With such a solid foundation, we can be calm."
Among deals to be clinched during Merkel's visit, Russian Railways will sign a letter of intent to buy nearly 700 locomotives from Germany's Siemens for about 2.5 billion euros ($3.2 billion), sources told Reuters.
LIMITS ON CIVIL SOCIETY
Merkel will be accompanied by eight ministers, including Foreign Minister Guido Westerwelle and Finance Minister Wolfgang Schauble, and a high-level business delegation.
International security issues such as the crisis in Syria and Iran's nuclear program are expected to be on the agenda. Merkel will also report on the state of Europe's debt crisis, but human rights issues look certain to feature prominently.
Senior German officials in Berlin said on Thursday a resolution approved last week by German parliamentarians expressing alarm at the state of human rights in Russia broadly reflected Merkel's stance and that of her government.
The West condemned Russia's jailing of members of punk band Pussy Riot for an anti-Putin protest in Moscow's main cathedral, although the German town of Wittenberg was criticized for nominating the group for a freedom of speech prize in October.
One senior German official said steps to limit civil society in Russia would be an "important theme".
Critics say such moves include the enactment on Wednesday of legislation broadening the definition of treason which could be used by Putin to try to stifle dissent.
"If there are new limits (on civil society), then naturally this is a concern for the chancellor and she will speak about it," the aide said.
Russia's Foreign Ministry has already hit out at Andreas Schockenhoff, Merkel's envoy for civil society ties between Russia and Germany and a sponsor of parliament's motion, refusing to recognize him as a German government representative.
"There is a growing group of Russian citizens who will not accept a ban on their freedom of expression," Schockenhoff told reporters in Moscow on Thursday.
Germany gets 40 percent of its gas and 30 percent of its oil from Russia, and German officials made clear that Moscow remained a "strategic partner".
But they dodged a question about whether Merkel and Putin had a good personal relationship.
"They have known each other for many years. But I wouldn't want to say anything about the nature of their relationship," one said.
(Additional reporting by Douglas Busvine and Noah Barkin in Berlin; Writing by Timothy Heritage and Gabriela Baczynska; Editing by Louise Ireland)