(Retops with signing of treaty)
By Arshad Mohammed and Jan Lopatka
PRAGUE, July 8 (Reuters) - The United States and the Czech Republic signed a treaty on Tuesday allowing Washington to build part of a missile defence shield in the central European state despite opposition from its former Cold War master Russia.
The deal to create a radar station southwest of Prague was marred by a failure seal a corresponding pact with Poland, where Washington wants to put 10 interceptor rockets that would be guided by the Czech site.
Washington says the shield would defend it and its European allies against missile attacks from a foe such as Iran, and points to intelligence suggesting Tehran could develop a long-range missile capable of striking its soil by 2015.
"This missile defence agreement is significant as a building block, not just for the security of the United States and of the Czech Republic, but for the security of NATO and ultimately for the security of the international community," U.S. Secretary of State Condoleezza Rice said in Prague.
Rice, who signed the treaty with Czech Foreign Minister Karel Schwarzenberg, all but ruled out going to neighbouring Poland after meeting its foreign minister on Monday.
Talks with Warsaw have run into a snag over Warsaw's demands for billions of dollars to modernise its army and air defences.
Rice said Monday's negotiations had been constructive but would not predict whether the two sides would reach a deal.
"I believe strongly that we are at a place where these negotiations need to come to a conclusion," Rice told reporters. "We are going to have to see if we can close the remaining gap."
She said missile proliferation was "not an imaginary threat" and noted Iran continued to enrich uranium -- which could lead to a nuclear weapon -- despite international demands it stop.
"They also continue apace their missile development, and so we need to be prepared for that threat," Rice said.
BASES NEAR RUSSIA
Russia says the shield is a threat and has threatened to aim nuclear missiles at central Europe if it is deployed. The United States says the 10 rockets are no match for Russia's atomic arsenal.
The United States was willing to make arrangements to make the system transparent to Moscow, but Russia would also have to discuss this directly with the Czech Republic, Rice said.
Political analysts say the planned bases in the former Soviet bloc would raise U.S. security interests in the region at a time when Russia grows more assertive about its role on the global stage.
"Moscow, of course, sees the move as a provocation and as a long-term security threat, and will seek to extract a hefty geopolitical or strategic price for going along," said Alexandr Kliment, an analyst at political risk consultancy Eurasia Group.
Russian President Dmitry Medvedev said after meeting U.S. President George W. Bush on Monday the two sides should keep talking despite failing to overcome differences on the shield.
The shield plan still faces hurdles, including widespread public opposition in the Czech Republic, a country of 10.4 million people that experienced two decades of occupation after the Soviet invasion of 1968.
It also faces obstacles to ratification in the Czech parliament, where the government has just 100 seats in the 200-seat chamber. Some deputies say they will oppose it.
The vote could be soon after a new U.S. administration takes over in January.
An opinion poll last month showed 68 percent of Czechs were against the shield, while 24 percent supported it. Protests were planned later for Tuesday.
"We believe that this could start another arms race, and we believe this will not raise the security of the Czech Republic," said Frantisek Smrcka, who along with other protesters unfurled a huge banner shaped like a target in the Czech capital.
Rice will also travel to Bulgaria and Georgia on her European trip this week. (Reporting by Arshad Mohammed; Writing by Jan Lopatka and Michael Winfrey; Editing by Timothy Heritage)