(Repeats story published late on Tuesday)
By Arshad Mohammed and Jan Lopatka
PRAGUE, July 8 (Reuters) - The United States and the Czech Republic signed an agreement on Tuesday to build part of a U.S. missile defence shield, prompting Russia to say that if deployed it would respond with "military-technical methods".
The U.S. and Czech foreign ministers toasted with champagne after signing the accord to place a tracking radar southwest of Prague as part of a system to protect against the perceived threat of missile attack from countries such as Iran.
But Russia, in a statement reminiscent of the Cold War, warned the United States against deploying a missile defence shield close to its borders.
"If the real deployment of an American strategic missile defence shield begins close to our borders, then we will be forced to react not with diplomatic methods, but with military-technical methods," the Foreign Ministry said in a statement on its www.mid.ru website.
The deal was also marred by a U.S. failure to 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 itself and its allies against missile attacks from so-called "rogue states" and points to intelligence suggesting Iran could develop a long-range missile capable of striking its soil by 2015.
"We face, with the Iranians, and so do our allies and friends, a growing missile threat that is getting ever longer and ever deeper, and where the Iranian appetite for nuclear technology, to this point, is still unchecked," U.S. Secretary of State Condoleezza Rice said after signing the deal.
However, the deal has its critics in the United States, who argue that the system has not demonstrated its capability under real operational conditions, and it is opposed by many in the Czech Republic, where it requires parliamentary approval.
Under the proposed $3.5 billion system, sensors and radar would detect an enemy missile in flight and guide a ground-based interceptor to destroy it without explosives.
ARMS RACE
Many Czechs are wary of any foreign military presence after the Soviet invasion in 1968 and the ensuing two decades of occupation. An opinion poll last month showed 68 percent of Czechs were against the shield, while 24 percent supported it.
"We believe that this could start another arms race," said Frantisek Smrcka, who with other protesters in the Czech capital unfurled a huge banner shaped like a bull's-eye.
Czech Foreign Minister Karel Schwarzenberg argued it was best for the Czech Republic, which is a member of the European Union and the North Atlantic Treaty Organization, to bind itself to the West.
"The Czech Republic can feel safe only if on the one hand it is anchored in the European society -- economically as well as security-wise -- on the other hand there's our relationship with the NATO," he said.
Russia, which has opposed the steady march of the Western security alliance toward its borders, earlier suggested it called into question U.S.-Russian talks on missile defence cooperation.
"A step has been taken ... which in our view has not added to security on the European continent. More than that, it has complicated problems of security," Interfax news agency quoted a senior Russian foreign ministry source as saying.
Moscow and Washington had agreed to explore ways of easing the Kremlin's concerns the shield would be used to spy on and target Russia's own missile systems. Proposals under discussion had included stationing Russian military officers at the shield sites and providing real-time video of activity there.
The shield is a major priority for U.S. President George W. Bush, who hopes to finalise an accord on the interceptors with Poland before he leaves office in January. After that, the system's fate will be decided by his successor.
U.S. officials, who last week said they had a tentative deal with Poland that required final approval from Warsaw, were dismayed when Polish Prime Minister Donald Tusk publicly said the pact was unacceptable and that further talks were needed.
The talks have run into a snag over Poland's demands for billions of dollars to modernise its army and air defences.
Rice told reporters that she had constructive discussions with the Polish foreign minister in Washington on Monday but she stressed that the United States had been generous in its offer and declined to predict whether a deal would be struck.
She all but ruled out the possibility of adding a stop in Warsaw on her current trip to Prague, Sofia and Tbilisi.