President Medvedev ordered a major military rearmament today, warning that Russia faced the risk of "significant conflict".

In a stark assessment, Mr Medvedev said that Nato was still intent on expanding closer to Russia's borders and told military chiefs to raise the combat readiness of the country's armed forces.

Russia's Defence Minister also lashed out at the United States, accusing it of plotting to take control of energy and mineral resources in states bordering Russia.

Mr Medvedev called for modernisation of Russia's nuclear forces and said that "large-scale rearmament" of the army and navy would commence in 2011.

"Analysis of the military-political situation in the world shows that serious conflict potential remains in some regions.... attempts to expand the military infrastructure of Nato near the borders of our country are continuing," he told Defence Ministry officials.

"The primary task is to increase the combat readiness of our forces, first of all our strategic nuclear forces. They must be able to fulfil all tasks necessary to ensure Russia's security."

The hawkish tone of the remarks came despite recent improvements in relations between Russia and Nato, and attempts by President Obama to ease tensions with the United States over missile defence in eastern Europe that built up under his predecessor George W. Bush. They also coincided with Gordon Brown's most progressive speech yet on nuclear disarmament, in which the Prime Minister called for a "forward plan" to be agreed by nuclear and non-nuclear states.

Anatoly Serdyukov, the Defence Minister, told the same meeting that the US was attempting to gain gain control of oil and gas resources in Russia's former Soviet neighbours in the Commonwealth of Independent States (CIS).

Mr Serdyukov warned that "the likelihood of armed conflicts and their potential danger for our state are rising" as America sought to expand its influence around Russia's borders and push Moscow out.

"The military-political situation has been characterised by the US leadership's desire to attain global leadership and expand the United States' and their allies' military presence in regions adjacent to Russia," he said.

"America's aspirations have been aimed at getting access to mineral, energy, and other resources of CIS countries, and it has actively supported processes aimed at ousting Russia from the area of its traditional interests."

Mr Serdyukov admitted, however, that most of Russia's weaponry was "old and obsolete". Modern equipment acccounted for only 10 per cent of the army's existing arsenal.

Mr Medvedev ordered an increase in military exercises to improve combat readiness and told army chiefs that "no expense should be spared for that" despite the economic crisis sweeping through Russia.

The conflict with Georgia over South Ossetia last August had exposed weaknesses in Russia's weaponry and communications systems that had to be rectified quickly.

Mr Medvedev has stationed more than 7,000 troops in South Ossetia and Georgia's other breakaway region of Abkhazia. He recognised them as independent after the war, a move condemned by Nato, the US and the European Union.

The previous Republican administration under President Bush pushed hard for Nato to offer Membership Action Plans to Georgia and Ukraine, a move fiercely opposed by Moscow. Mr Obama has given no indication so far that he is as enthusiastic about Nato expansion.

He held out the prospect of a deal with the Kremlin over missile defence earlier this month in return for help with preventing Iran developing a nuclear bomb.

Mr Obama wrote to his Russian counterpart, saying that the plan to base interceptor missiles in Poland and a radar in the Czech Republic would be unnecessary if the nuclear threat from Iran was removed.

Mr Medvedev insisted that he would not engage in any "trade-off" but appeared encouraged at the time by what he described as the new signals coming from Washington. The initiative came shortly after Joe Biden, the US Vice-President, declared that the US wanted to press the "reset" button on relations with Russia.

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