Putin is on his first visit to China since becoming prime minister last May and will also attend a summit of the Shanghai Co-operation Organisation, a regional security grouping made up of China, Russia, and four Central Asian nations.
Alexander Zhukov, the Russian deputy prime minister, said there were about 40 projects, including a pair of $500m banking deals, that were expected to be signed during the visit.
“It’s the first time, perhaps, that such large commercial deals are being sealed in such volume between Russian and Chinese enterprises,” he said.
“Naturally, the Chinese are interested in getting [ownership] stakes.”
The former rivals-turned-strategic partners were trying to work out an energy deal, Zhukov said, adding that the two sides also signed an agreement on advance notification for planned ballistic missile launches by either country. He gave no details.
Russia’s cash-strapped energy companies need Chinese funding, while Beijing has taken advantage of the opportunity to further diversify sources for the energy it needs to fuel its fast-growing economy.
The global economic crisis and changing market conditions have further spurred co-operation as lower demand from Europe has spurred Russia to diversify markets for its oil and gas.
According to Chinese media reports and analysts the energy agreement being negotiated is expected to be a gas-for-loans deal similar to a $25bn oil-for-loans deal that was completed earlier this year.
In exchange for that deal, China was guaranteed a 20-year supply of crude oil.