Vladimir Putin likened America’s plans for a missile defence system in Europe to the Cuban missile crisis today as he insisted that he would relinquish power in the next Russian presidential elections.

Mr Putin said that finding out about the US scheme to put interceptor missiles in Poland near the Russian border had echoed President John F. Kennedy’s discovery of Soviet missiles in the Caribbean in 1962.

The alarming comparison came at the close of an EU/Russia summit in Portugal in which both sides were at pains to emphasise the constructive side of their relationship after a tense year of disagreements over energy, trade and human rights issues.

Mr Putin, who has faced sharp criticism over the deaths and imprisonment of journalists and politicians in Russia, went on the front foot by proposing a new EU/Russia human rights institute to promote values across the continent.

But it was the missile shield which provoked the strongest reaction from the Russian President, who attacked Washington yesterday for “running around crazily like a man with a blade in his hand” for threatening fresh sanctions against Iran.

"I would remind you how relations were developing in a similar situation in the middle of the 1960s," he said, recalling an event that led the superpowers to the brink of nuclear war.

“Similar actions by the Soviet Union when it deployed missiles on Cuba led to the Caribbean crisis [the Russian term for the Cuban missile crisis]. For us the situation is very similar. On our borders such threats to our country are being created.”

But the Russian President concluded: “Thankfully, we do not have any Caribbean crisis now because the situation has changed, above all because of the fundamental way relations between Russia and the United States and Europe have changed.”

While he was disappointed that the White House had not responded to his proposals for sharing missile defence responsibility, he said that he considered President Bush to be a friend with whom he could deal.

Mr Putin said that he was undecided about his next career move when asked about his plans for the future after Russian presidential elections next March. Under the constitution, he must step down after completing two terms as president.

He went on to answer those who have speculated that he could simply become prime minister and continue effectively to run the country with a puppet president.

"As I have said on numerous occasions, I am not going to change the constitution to serve my own needs,” he said. “I will not run for president for a third time. As to my future job, I have not decided … but in any case I do not think there is a need to change the composition of authority with the executive branch of power in Russia.

“If anyone thinks I am going to move to the Government of the Russian federation and transfer most power to the Government, it is not so. The capacity of Russian President will remain what it is as long as it is up to me.”

The Kremlin has said that Mr Putin will retain a political role after stepping down. He is the main candidate for United Russia, the ruling party, for the parliamentary elections in December and has hinted that he may become prime minister.

Although the one-day summit, in the Portuguese city of Mafra, also considered trade and economic relations, the press conference afterwards was dominated by the Russian President and the direction of his country.

The two sides failed to sign a new co-operation agreement, with only two minor deals, on drug trafficking and steel exports, announced.

José Manuel Barroso, the President of the European Commission, added that Russia had accepted observers for its elections from the Organisation for Security and Co-operation in Europe (OSCE).

“We are pleased that Russia has agreed to invite OSCE observers ... according to normal OSCE standards and practices,” Mr Barroso said. This would amount to a considerable breakthrough after Russia’s recent criticism of the body and its attempts to block its budget.

Russian membership of the World Trade Organisation was said to be very close by Mr Barroso, with just two technical issues standing in the way.

The future of the Serbian province of Kosovo was discussed behind the scenes but not in the press conference. Mr Putin also avoided a further question about Iran but found time to criticise Sweden for refusing to extradite a suspect in the murder of a Russian journalist in Chechnya.

Times Recommends

• No cause for celebration in crushed Sarajevo
• Jazz funeral for the final victims of Katrina
• French fined for 'insulting' civil servants