TERRORISM, DRUGS AND NMD ON AGENDA AS CHINA HOSTS "SHANGHAI FIVE"

SHANGHAI -- The presidents of China, Russia and four Central Asian states
begin two days of talks Thursday on regional security issues such as
Islamic militancy, drug smuggling and organised crime.

Regional powerbrokers China and Russia were also expected to rally
opposition to US President George W. Bush's plans to build a missile
defence shield during the discussions in the eastern Chinese city of Shanghai.

Security was tight for the meeting of the "Shanghai Five" forum -- which
also comprises Kazakhstan, Kyrgyzstan and Tajikistan -- with heavy police
deployment around the meeting venues across the city.

The forum was set up in 1996 to scale down Sino-Soviet Cold War troop
deployments, but has now evolved into a security mechanism aimed at
combating instability in the Central Asian region.

As part of efforts to crush growing Islamic militancy, the leaders are to
sign a new anti-terrorist agreement and admit Uzbekistan as a sixth member.
They will also establish the forum as a "multilateral regional organisation".

The Uzbek regime of President Islam Karimov has faced successive summer
offensives from Islamic rebels in the Ferghana Valley straddling
Uzbekistan, Kyrgyzstan and Tajikistan.

Analysts say Karimov needs the support of Moscow to deal with the Islamic
Movement of Uzbekistan (IMU), while Russia in turn believes the IMU is
fueling the conflict in its breakaway southern republic of Chechnya.

China fears Islamic militants in Central Asia will encourage separatism in
the troubled northeastern Xinjiang region, where Uighur Islamic militants
have carried out violent anti-government attacks in recent years.

Speaking in Moscow before his departure for Shanghai, Russian President
Vladimir Putin said concrete measures were needed to fight the scourges of
organised crime, arms and drug trafficking, and terrorism in the region.

"Russia's withdrawal from Central Asia after the fall of the Soviet Union
created a vacuum ... which religious extremists and terrorist organisations
are trying to fill," Putin said.

At the summit, Putin is to push Russia's attempt to set up a rapid reaction
force based in the Kyrgyz capital Bishkek to repel incursions into Central
Asia from Islamic militant training camps in Taliban-ruled Afghanistan.

The Russian leader is to meet Thursday with Chinese President Jiang Zemin,
the first of three meetings in three months as the two countries develop a
strategic alliance to counter US domination of world affairs.

Top of the agenda is Bush's attempts to scrap the 1972 Anti-Ballistic
Missile Treaty and build a national missile defence (NMD) shield, a move
resolutely opposed by both Beijing and Moscow.

The meeting comes just two days before Putin meets Bush in Slovenia for
their first summit, and as the American leader tours Europe trying to win
support for his missile shield plans from sceptical NATO allies.

The "Shanghai Five" forum has traditionally focused on security issues,
although Chinese officials say efforts will be made during the two days of
talks to initiate an economic dialogue between the members.

Both China and Russia have their eye on the oil and gas resources of
Central Asia, in particular Kazakhstan, and both countries are keen to
offset growing US investment in the region's energy industry.

Chinese President Jiang is also due to hold bilateral talks with Kazakh
counterpart Nursultan Nazarbayev, President Askar Askayev of Kyrgyzstan,
Uzbek President Karimov and Tajik leader Emomali Rakhmonov.