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.

Russia's Prime Minister Vladimir Putin (L) speaks as he meets with members of the Valdai discussion group of Russia experts in the Black Sea resort of Sochi, September 6, 2010. [Agencies]?

"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.

China and Russia say their trade and political relations are better than ever.

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.

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.

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.