Asserting that the epicentre of instability is in the neighbourhood, President A P J Abdul Kalam on Wednesday night said the international community should target not only those who perpetrate acts of terrorism, but also those who assist, finance and sponsor terrorists.

"Two years ago, on your previous visit to India, you had referred to the 'arc of instability' stretching from the Caucasus to South East Asia. The epicentre of this arc is, of course, our common neighbourhood," he said at the banquet held in honour of Russian President Vladimir Putin.

Asserting that India and Russia share common views on key issues, Putin, joining him in raising a toast, said the two countries are jointly fighting international terrorism, which has "challenged our civilisation".

He said the two countries are ready to cooperate in promoting human rights, global and regional stability and sustainable development. "We intend to create new opportunities in our bilateral trade and economic cooperation. Our overall objective is to promote public and business initiatives of our citizens," Putin added.

Kalam said the recent hostage crisis in a Moscow theatre and the attack on temples in India testified to the ruthlessness with which terrorists threaten innocent people. "We know that such acts were often undertaken with foreign assistance," he said.

"We cannot make any untenable distinctions between terrorists and 'freedom fighters'... terrorism cannot be justified on any grounds..." he said.

Asserting that India and Russia share close friendship, trust and cooperation, Kalam said the relations between the two countries have withstood the test of time and have met new challenges of the post-Cold War era with success.

"Today, our shared commitment to democracy and pluralism has added a new dimension to our relationship," he said, adding that the joint statement issued on Wednesday strengthens bilateral relationship and strategic partnership by reaffirming the efforts needed for enhanced trade and economic relations.

The joint statement also stressed on the need for international peace, security and stability, with determined actions for elimination of international terrorism and religious extremism, he said adding that India and Russia, along with like-minded friendly countries, could work for a peaceful, nuclear-free and poverty-free world.

Kalam also said that as large heterogeneous societies that cherish their multi-ethnic, multi-religious and multi-cultural diversities, the two countries face a number of common challenges and tasks. "We have a stake in each other's unity and integrity, strength and stability, security and prosperity," he added.

Kalam said defence cooperation constituted an important element of the bilateral relations. "Today, our relations in the defence field have transcended a mere 'buyer-seller' relationship and have expanded to include joint research and development, scientist-to-scientist interaction and service-to-service contacts," he said.

The President said, "We have made impressive strides in joint design, development and production of high technology product Brahmos. The joint venture supersonic cruise missile is a unique example of the partnership between our two countries in critical areas of defence research and development."

In the field of science and technology, he said an Indo-Russian Science Centre would be set up soon to help scientists commercialise their results for the larger benefit of the industry and society.