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After decades of striving for military supremacy, the Kremlin wants a smaller, cheaper army that doesn't "suck blood" from its economy, President Vladimir Putin says.

In an interview with The Globe and Mail, Mr. Putin, who arrives in Ottawa on Sunday for his first state visit to Canada, revealed a new strategic calculus that is transforming Russia's view of itself and the world.

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The economy, not the military, is his new battle cry.

The 48-year-old former KGB officer swept to power last year on the strength of his hawkish rhetoric and his military campaign in Chechnya. But today he portrays himself as a pragmatist who has discovered the economic fruits of a downsized army.

"Competition today has shifted from the military sphere to the economic sphere," Mr. Putin said in the interview from the Kremlin. "We have to look at things realistically. In the global list of economically developed countries, Russia is located in the middle."

While many Russian nationalists yearn for the days when the Soviet Union was a mighty superpower, Mr. Putin gave a surprisingly humble view of Russia's place in the world and the advantages of its more modest ambitions.

"We are satisfied with our present position because it doesn't demand excessive effort in the defence field. It doesn't suck blood from the economy of our country, even though we are still spending quite a lot to maintain the defence system of our state."

Before launching his seven-day tour of Cuba and Canada, Mr. Putin gave a 70-minute interview to The Globe and Mail, CBC and CTV, which will also be broadcast on Russian state television.

While lauding the benefits of a smaller military, Mr. Putin remains committed to an assertive view of Russia's strategic interests. He made it clear Russia is still strongly opposed to U.S. military domination and the expansion of the North Atlantic Treaty Organization.

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"The world cannot develop effectively and positively if one state has a monopoly on taking and implementing whatever decisions it wants," Mr. Putin said in a clear reference to the United States.

"In the history of mankind, such a drive for a monopoly has never ended well. For that reason, we are constantly proposing a different democratic world structure."

But his thinly veiled jab at the United States was accompanied by a plea for nuclear co-operation - a mission, he said, where Canadian help could be useful.

Canada and Russia have "very close" positions in support of a 1972 arms-control treaty that Washington wants to change in order to build an antimissile defence system, Mr. Putin said. By finding "points of agreement" with Russia on the arms dispute, Canada could help resolve one of the world's top security problems.

"We are not looking for enemies. . . . The lower the level of nuclear conflict between the main nuclear states, the better. That's why we call upon the world community and our partners in the nuclear club to act together to ease the nuclear confrontation."

Asked about Russian fighter jets that buzzed a U.S. aircraft carrier in October, taking photos of its flight deck, Mr. Putin insisted it was "nothing unusual" and that U.S. sailors "treated it quite calmly, like an ordinary event."

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He also defended the brutal war in Chechnya, calling it an action against "terrorists" and "fanatics" who threaten the civilized world. "No humanitarian rules should be applied to terrorists." But a final settlement of the Chechnya conflict "can be reached only by legal and political means," he said.

Russian liberals have sharply criticized Mr. Putin for many recent actions, including the revival of the Soviet national anthem and the jailing of businessman Vladimir Gusinsky, who created Russia's biggest private media empire.

None of these moves, he responded, are a threat to Russian democracy or media freedom.

"I assure you that there is no danger that the structure of democratic society, which was built over the past 10 years, could be dismantled," he said.

"When we speak of the strengthening of the state, we don't mean the curtailment of democratic freedoms, because without adequately developed democratic institutions for the protection of human rights - including in business - the market economy cannot develop."

Mr. Putin conceded, however, that his drive to strengthen Russia could pose some dangers for civil society. "The state always tries to create the most favourable conditions for itself and tries to forbid everything. This is true not just in Russia, but in all other countries."

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Mr. Putin said he is confident Russia's constitution and legal system - often criticized by outsiders as corrupt and vulnerable to political manipulation - are strong enough to resist these pressures.

But he had no such assurances to offer the oligarchs, a small group of tycoons who rose to power during the presidency of Boris Yeltsin and against whom Mr. Putin has launched a high-profile campaign.

"They see the mass media as their chief instrument of influence over the state. They have all become accustomed, especially recently, to getting everything they want from the state and using it as they want. They don't want to live in accordance with the law, and I don't think that's right."

On the revival of the Soviet anthem, Mr. Putin said he respected the views of liberals who associate it with Joseph Stalin, the dictator who commissioned the song in the 1940s. "Many people still remember the full horrors of Stalin's prison camps, and their wounds are still bleeding."

But many of Russia's greatest achievements are linked to the Soviet period and its symbols, Mr. Putin said.

"Take the first flight of man in space. That was a Soviet man, Yuri Gagarin. That flight was made possible by the labour of millions of citizens of my country, who sacrificed everything. And they have the right to take something into today's life . . . something to remind them of their earlier life."

Mr. Yeltsin is among the many Russians who have criticized the adoption of the Soviet anthem. This is a "logical" and "principled" stand for Mr. Yeltsin to take, since he is a long-time fighter against communism, Mr. Putin said.

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