Updated

Japan's prime minister strongly protested Russian President Dmitry Medvedev's visit to a disputed island and said in a meeting on the sidelines of a Pacific Rim leaders' conference Saturday that the two nations must build mutual trust.

Medvedev reportedly responded that he will return to the island whenever he pleases.

Prime Minister Naoto Kan told Medvedev that the Nov. 1 visit was unacceptable and inflamed the feelings of the Japanese people, Japanese Deputy Chief Cabinet Secretary Tetsuro Fukuyama said. Kan said the two nations, which have never signed a treaty formally ending their World War II hostilities because of the territorial dispute, must work to develop trust.

The talks Saturday — which Japanese officials said began in a "tense mood" — were their first since Medvedev's trip to the island, known as Kunashiri in Japan and Kunashir in Russia. Russia captured the island and several others in the closing days of World War II.

The meeting also comes as Japan's relations with China have soured over another territorial dispute involving islands to the south.

Fukuyama said Medvedev told Kan that bolstered economic relations would improve the atmosphere between the two nations.

Russian media portrayed Medvedev's reaction as forceful.

The Russian news agency RIA Novosti reported that Medvedev underlined Russia's claims to the islands and said he reserves the right to visit whenever he chooses.

"Kan expressed regret about President Dmitry Anatolevich Medvedev's visit to the island of Kunashir, but our position is as follows: The president will decide for himself which region of Russia to visit," RIA quoted Foreign Minister Sergey Lavrov as saying.

"It is our territory, and that's how it will stay," he said. "Our Japanese colleagues, I hope, will adopt a more appropriate attitude toward this."

Lavrov said the two agreed that economic ties should be put ahead of the territorial spat.

Kan, however, accepted an invitation to visit Russia, Lavrov said.

Underscoring efforts to develop economic ties despite Japan's unhappiness with Medvedev, the two sides joined in signing a $1 billion deal to build a large fertilizer plant at Mendeleevsk, a city about 625 miles (1,000 kilometers) east of Moscow.

The deal with Japan's Mitsubishi Heavy Industries Ltd., Sojitz Corp. and China National Chemical Engineering Corp. calls for a factory that will produce both ammonia and methanol from natural gas, using technologies from Denmark and the Netherlands, the companies said in a statement.

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Associated Press writer David Nowak in Moscow contributed to this report.