By TOM RAUM, Associated Press Writer

BRATISLAVA, Slovakia - President Bush and Russian President Vladimir Putin sought common ground Thursday on keeping conventional and nuclear weapons out of the hands of terrorists, a positive note in talks likely to raise sensitive questions about Russia's support of Iran and democratic rollbacks.

Both leaders entered discussions cautiously, wanting to air their grievances without undercutting generally improved relations between the old Cold War nuclear rivals who are cooperating in the war on terror.

The leaders opened talks at a medieval castle overlooking the snow covered capital and the Danube River, aides inked an agreement designed to counter nuclear terrorism, in part by restricting the availability of shoulder-fired missiles capable of bringing down aircraft.

Bush prefaced his meeting with the Russian leader — their first since Bush's new term began in January — with a speech in a crowded town square hailing the spread of democracy to former Soviet republics like Slovakia.

High on the meeting agenda are U.S. concerns over Putin's moves to solidify his power and clamp down on civil and press liberties. Also drawing U.S. alarm are Putin's attempts to influence elections in Ukraine, Russian arms sales to Syria and the Kremlin's close ties to Iran.

But Bush seeks to balance those concerns with a desire for continued cooperation on security issues such as terrorism, weapons proliferation and energy.

For their part, Russian officials dislike what they see as U.S. meddling in their internal affairs and in former Soviet republics where Moscow's influence is waning as some new leaders look westward. Putin argues that the Russian people are accustomed to strong rule by czars and a large government role in everyday life.

Putin has sent mixed signals — offering conciliatory talk aimed at boosting Russia's international standing and its chances for membership in the World Trade Organization, but at other times saying America has double standards on terrorism and is seeking to spread a dubious form of democracy.

The two leaders arrived to a red carpet ceremony in the courtyard of the red-roofed Bratislava Castle, exchanging handshakes and smiles. About a dozen troops, clad in fur-trimmed red and blue uniforms, stood at attention. Elsewhere in the capital, security was tight. Hundreds of heavily armed police officers and sharpshooters kept watch and helicopters flew overhead.

Under the new agreement, both nations would share information, take inventories of such weapons, destroy "excess and obsolete" ones, and coordinate efforts to keep them out of the hands of terrorists.

The possession of the shoulder-fired missiles in the hands of criminals or terrorists pose a threat to both passenger and military aviation, a White House statement said. Approximately 1 million of these weapons have been produced worldwide, an thousands may now be in the hands of "non-state actors," the statement said.

Administration officials, speaking on the condition of anonymity, also said the agreement will include a promise to upgrade security at Russia's nuclear plants and weapons stockpiles, new procedures for responding to possible terrorist attacks and a program to keep nuclear fuel from being diverted to use in nuclear weapons.

Ahead of the meeting, Bush expressed concerns about Putin's recent crackdown on political and press freedom.

"I look forward to talking to him about his decision-making process," Bush told a group of young German business leaders Wednesday in Mainz, Germany.

"It's a complex relationship," Bush's national security adviser, Stephen Hadley, said of the U.S.-Russian dynamic, adding that democracy in Russia remains "a work in progress."

"A free and democratic Russia is better for Russia. It's better for us," Hadley said. Democratic reform will help Russia gain strength
as it moves into the 21st century and "hopefully that's something they will understand as well," he said.

Before his meeting with Putin, Bush spoke to thousands of citizens huddled against a wet snow. He thanked Slovaks for their deployment of non-combat troops to Iraq  and celebrated the example their 1989 triumph over communism provides.

"For the Iraqi people, this is their 1989 and they will always remember who stood with them in their quest for freedom," the
president said.

The two leaders also discussed the campaign to persuade Iran to abandon its nuclear weapons ambitions. The subject has been a prime topic throughout Bush's European trip, and aides have left open the possibility that he would consider the European-led effort to offer incentives to persuade Iran to drop its program. "Hopefully, we'll be able to reach a diplomatic solution," Bush said.

The Bush-Putin talks come nearly a year after Putin's strong re-election victory. However, he is in a weakened position following a series of mishaps and setbacks in both domestic and foreign policy.

Those include increased violence in the Chechen conflict, in particular the horrifying raid on a school in Beslan that ended in a torrent of gunfire and explosions that killed more than 330 people, half of them children.

Putin also ended direct popular election of regional governors, increasing central control. And he waged a campaign against the Yukos oil company and its founders. Both drew criticism at home and abroad.

The visit to Slovakia was the final leg on Bush's five-day tour to heal the trans-Atlantic rift caused by his March 2003 decision to invade Iraq without broad international support. He visited Belgium and Germany before coming here, and met with nearly all European leaders at NATO and European Union  meetings in Brussels.