UPDATE 3-Russia upset by U.S. shield proposals - reports

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By Christian Lowe

U.S. proposals aimed at easing Russian opposition to its planned missile defence shield fall far short of Moscow's expectations, Russian media quoted Foreign Ministry sources as saying on Friday.

"Our hopes have not been borne out. This is not what we were promised," Itar-Tass news agency quoted the Foreign Ministry source as saying.

The United States submitted a package of documents to Russia this week setting out compromise proposals on the shield. These were first raised when U.S. Secretary of State Condoleezza Rice and Defense Secretary Robert Gates visited Moscow in October.

"The proposals put forward in Moscow by the American defense secretary and the secretary of state have been practically revoked," another Foreign Ministry source was quoted by RIA news agency as saying.

"Everything is so watered down it is difficult to even recognise in the text what was proposed by the Americans when they came to Moscow."

Washington wants to station interceptor missiles in Poland and a radar system in the Czech Republic as part of a shield it says is essential to protect Europe from rocket attacks by what is calls "rogue states" such as Iran and North Korea.

Russia believes the shield is targeted against its missile arsenal and poses a threat to its national security. President Vladimir Putin has suggested there would be unspecified retaliatory measures if the shield goes ahead.

Putin last month drew a parallel between the U.S. missile shield and the 1962 Cuban missile crisis, widely regarded as the closest the world has come to nuclear war.

He said Washington's plan to put its installations in eastern Europe were "analogous" to the Soviet attempt to station missiles on Cuba, off the United States' eastern seaboard.

PROPOSALS

Details of Washington's written proposals on the missile shield in Europe have not been made public, but U.S. officials have said they include:

* Inviting Russia to enter into a partnership with the United States on missile defence.

* Giving Russian liaison officers access to U.S. missile sites to promote transparency.

* An offer to put the missile shield sites in standby mode once they are built, pending proof of a missile threat. This is intended to head off Russian arguments that Iran and North Korea do not have the capability to launch missile strikes on Europe.

After Rice and Gates first raised the proposals, there was cautious optimism in Moscow that a deal could be reached. A senior Kremlin aide said last month the proposals were "positive signs" and a "source of hope".

But Russian officials have expressed scepticism as more details of the proposals have emerged.

"The United States has passed to us its specific proposals on missile defence," Tass quoted the Foreign Ministry source as saying.

"Our first look at them has shown that over the six weeks during which the American side promised to prepare written proposals, the U.S. position has not changed."

Putin has offered an alternative to the missile shield under which the United States would have access to missile launch data from a Russian radar station and a second station operated by Moscow in ex-Soviet Azerbaijan.

The Pentagon has said Putin's offer could complement its own missile shield plan but is not a substitute. (Editing by Andrew Roche)

Keywords: SHIELD RUSSIA/PROPOSALS

[MOSCOW/Reuters/Finance.cz]