President Vladimir Putin said Thursday the escalating dispute with Britain over Russia's refusal to extradite the suspect in Kremlin critic Alexander Litvinenko's death was a "mini-crisis" but he was certain the nations would overcome it.

At the same time, Putin suggested it was up to Britain to back down in the confrontation. He spoke after Russia announced it will expel four British diplomats, mirroring punishment meted out by London for its refusal to hand over suspect Andrei Lugovoi.

"I think Russian-British relations will develop normally. On both the Russian side and the British side, we are interested in the development of these relations," Putin said. "But it is necessary to balance our actions with common sense, to respect the legal rights and interests of partners — then everything will develop in the best way."

"I'm sure we will overcome this mini-crisis, too," he said.

Putin's remarks appeared aimed at playing down the significance of the dispute on relations between Russia and Britain, which have strong business links, while also claiming the high ground and suggesting London has acted incorrectly.

In Moscow, the British ambassador was summoned to the Foreign Ministry's imposing Stalin-era tower and informed of Russia's response to Britain's announcement of the expulsion of four Russian diplomats and restrictions on visas to Russian officials.

In addition to mirroring Britain's punishment by expelling four British diplomats, ministry spokesman Mikhail Kamynin said Russia would stop issuing visas to British officials and halt counterterrorism cooperation. But Moscow carefully avoided measures that could affect economic ties.

Britain called the Russian response "completely unjustified" and vowed to push for international backing in a dispute that has deepened the rift between Russia and the West. The United States swiftly expressed support, with Secretary of State Condoleezza Rice urging Moscow to extradite Lugovoi.

Lugovoi is the sole suspect named by Britain in the death of Litvinenko, an ally of exiled tycoon and fierce Kremlin foe Boris Berezovsky. Litvinenko, who died Nov. 23, met with Lugovoi three weeks earlier — the day he said he fell ill — at a London hotel bar where traces of polonium were later found.

Britain's announcement Monday came after Russia formally rejected Britain's request for Lugovoi's extradition, citing a constitutional ban on the extradition of its citizens. Putin has called the British request "stupidity."

Kamynin called Russia's moves "targeted, balanced and the minimum necessary." He said the new government of British Prime Minister Gordon Brown "made a conscious choice of worsening relations with our country."

While Russia's response marked an escalation in the standoff, with no resolution in sight, it appeared to tread softly on investment and trade ties with Britain.

British companies have some US$12 billion (euro8.7 billion) invested in Russia and Britain is a prime customer for Russian oil, gas and precious metals.

"There are common interests here, and I think nobody wants to touch them," said Alexei Malashenko, an analyst at the Carnegie Moscow Center.

Kamynin stressed that the interest of business people — as well as tourists and citizens with ties to Britain — would not be hurt.

He said Russia will stop issuing visas to British officials and seeking British visas for Russian officials until London provides more information on the restrictions it has imposed.

He also said Russia was suspending cooperation against terrorism, saying it had become "impossible."

Analysts said that move, with Britain on edge over recent terrorist activity, was meant largely for show.

"There is simply not much concrete cooperation on terrorism," Malashenko said, adding that the two nations are focused on different terror concerns.

Natalia Leshchenko, an analyst at the Global Insight think tank, said on British Broadcasting Corp. television that Britain and Russia do cooperate against terror, but suggested the suspension was mainly meant to tarnish the new British government.

Britain swiftly denounced the Russian moves and vowed to seek international support for its stance.

"We think the action they have taken is completely unjustified and we will continue to take this matter forward with the international community over the next weeks," said Brown's spokesman, Michael Ellam.

Rice offered U.S. support.

"There was a terrible crime perpetrated on British soil. That crime needs to be investigated, and the perpetrators brought to justice and punished," Rice said in Portugal. "It is going to be very difficult to do that without the extradition of those who were requested by the British and without the full cooperation of Russia.

The dispute marks a new low in Russian-British relations, which already were damaged by Russia's opposition to the war in Iraq, Britain's refusal to extradite Berezovsky on embezzlement and coup-plotting charges, and Moscow's allegation last year of spying by British diplomats.

It also has strained ties between Russia and the West, which Moscow accuses of meddling in its affairs. Litvinenko's death and a trail of polonium left across Europe attracted worldwide attention and sparked speculation of involvement by Putin's government, already under fire abroad for its treatment of critics.

British officials have not claimed official Russian involvement in the killing, but the row over the diplomats renewed allegations by critics of the Kremlin in Britain, such as Berezovsky. Kremlin allies, meanwhile, claim Berezovsky could have had Litvinenko killed to blacken Putin's reputation.