Vladimir Putin: 'Georgia? We couldn't just let Russia get a bloody nose'

Whether prime Minister or President, the man holding forth across the vast dining table was unmistakably Vladimir Putin. Wagging his finger and occasionally clenching his fist, the man who many believe retains the real power in Russia denied that the world was entering a new Cold War, rejected claims that he wanted to restore the Soviet empire and insisted that a fresh arms race in Europe was avoidable.

His immediate concern, he made clear, was to defend his country's much-criticised action in Georgia. He stressed that Russia had no choice. "They attacked South Ossetia with missiles, tanks, heavy artillery and ground troops. What were we supposed to do?"

If his country had not invaded, he said, it would have been like Russia "getting a bloody nose and hanging its head down", and there would be a "second blow" into the north Caucasus.

Reminding his guests that he had been at the Olympics in Beijing when the crisis broke out, Mr Putin said he was "astonished, astounded," by the world media silence on the Georgian aggression. "What did you expect us to do? Respond with a catapult? We punched the aggressor in the face, as all the military text books prescribe."

For three-and-a-half hours yesterday, he juggled knives, forks, a succession of elegantly full plates and question upon question from some of the world's leading Russia-watchers on everything from the conflict in the Caucasus to his relations with his successor in the Kremlin.

It was a commanding performance that began with an forcefully worded statement on Georgia for the benefit of Russian television cameras and moved on to an enthusiastic discussion of his new role and the excitement of learning all over again. The only sign of his new status was that a similar lunch for foreign guests last year was held in an enormous marquee in the grounds of the presidential summer residence; this year it was at a VIP complex in this Russian resort which will host the Winter Olympics in 2014.

A troupe of whispering waiters offered discreet service under the restored dome of the former sanatorium, now an exclusive holiday destination for Russia's elite. When the diners sat down they faced a starter of smoked duck and bitter orange sauce together with a rank of four glasses, local mineral water, cranberry juice, as well as red and white wines.

Mr Putin responded angrily to accusations that Moscow had used disproportionate force in Georgia, saying Russian troops were not sent into South Ossetia for 36 hours after the initial attack. Russian forces then unleashed an aerial bombardment, tanks and ground troops but not before Georgia had captured the southern part of South Ossetia up to and including the suburbs of its capital, Tskhinvali, he said. He adopted an even darker tone upon mention of the Pentagon's missile shield. After accusing the US of acting like "a Roman emperor", he warned Poland and the Czech Republic against hosting US missiles. He said there was still a chance for the installations not to be activated, but warned: "Our targeting of these countries will happen as soon as these missiles are brought. Please do not instigate an arms race in Europe. It is not needed. What should we do? Sit pretty while they deploy missiles?"

He was constantly at pains to clarify where power lies in today's Russia, amid speculation at home and abroad that the new President, Dmitry Medvedev, is no more than Mr Putin's creature. On South Ossetia, Mr Putin said the new President took all the decisions. Mr Medvedev decided to send in the troops, and decided that Moscow would recognise the independence of South Ossetia and Abkhazia. The former president expressed considerable sympathy for Mr Medvedev. It was "unfortunate" he said, that Mr Medvedev had faced such a crisis so early in his presidency. There had been a real chance to make a fresh start Mr Medvedev – a "convinced liberal and democrat, modern in outlook – had had to show a "tough face".

Mr Putin spoke about tackling hitherto unsolved problems in the Russian economy and Moscow's relations with almost every country represented, including Britain, which he had accused of harbouring known criminals and individuals involved in terrorism. "OK," he said, "they have the protection of Brtish justice, but why are they allowed to use this haven as a launching pad for anti-Russian activity?"

He was keen to draw a distinction between the conflict in the Caucasus and Russia's relations with other former Soviet satellites, as he continually denied any imperial ambitions on the part of the Kremlin. He noted that Russia had border treaties with most of these countries which acknowleged their sovereignty. "Today there are no ideological contradictions; there is no basis for a Cold War," he said.

On Ukraine and its possible future membership of Nato, Mr Putin warned that there was no public majority in the country itself in support of this. He scornfully denounced the architects of the so-called orange revolution, saying the leadership was "divided and chaotic". He joked about accusations that Ukraine's Prime Minister, Julia Tymoshenko, was siding with pro-Russian elements. The idea that the abrasively anti-Russian politician had changed sides prompted laughter and a roll of the eyes. "Heavens above," he said. "What have we come to now?"

The one-time head of the rebranded KGB, the FSB, bemoaned what he described as Russia being "embattled and encircled" by a "hostile West", accompanying his compaints with occasional sighs of frustration. Mr Putin said that Russia strongly opposed Nato membership for its western neighbour but for the first time said that if the Ukrainian people voted to join Nato, "that would be their decision". In which case, "so be it", he added. This was a sharp change from his position two years ago when he accepted Ukraine might join the EU but expressed outright opposition to it joining Nato.

The anger and industrial language on display for a domestic TV audience gave way to a more measured performance after the cameras departed and food was served. Unfettered by aides and without his security men who had accompanied him into the banquet hall, he fielded questions openly, calling journalists by name. This time last year, Mr Putin had seemed demob happy and almost disengaged. At this meeting, he seemed particularly intent on his new job as Prime Minister which he presented as being mainly responsible for Russia's economy.

Russia was facing problems today, he said, which demanded new solutions. "The solutions of the past wouldn't do." State infrastructure, housing, health and education all needed to be overhauled. This represented an unusual admission that Russia was now lagging behind in areas that the Soviet Union had excelled.

He reserved particular hostility for the US Vice-President, Dick Cheney, who recently toured former Soviet states. "There is no more Soviet threat but they are trying to resurrect it," said Mr Putin.

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