MOSCOW (Reuters) - Secretary of State Colin Powell said Monday he was worried about Russia's democracy, in unusually blunt comments that underscored widespread concerns the Kremlin is turning increasingly autocratic.

In a front-page article published in major Russian daily Izvestia, he said Russian politics were not sufficiently subject to the rule of law and made clear there were limits to the U.S.-Russian relationship without shared values.

While couched in diplomatic terms, Powell's comments were unusually direct from a U.S. administration that has worked closely with Moscow in the U.S.-led war on terrorism and has cooperated on regional issues from North Korea to Iran.

He also challenged Russia's policy in Chechnya and -- without citing any countries by name -- its recently assertive dealings toward nations like Georgia, Moldova and Ukraine.

"Certain developments in Russian politics and foreign policy in recent months have given us pause," he wrote at the start of a two-day visit to Moscow for talks with Russian President Vladimir Putin and Foreign Minister Igor Ivanov.

But at a meeting with Putin in the Kremlin, Powell took a more diplomatic line.

"Of course, we do have areas of disagreement... the strength of the relationship allows us to discuss these areas with candor and openness."

Putin made no reference to Powell's article, focusing instead on the robustness of relations with Washington.

"I can say that the attitude of the Russian Federation toward the United States will be one of stability and predictability," he said.

While relations between President Bush and Putin have warmed by the year, in recent months there have been widespread concerns that the Kremlin is turning more and more authoritarian.

"Russia's democratic system seems not yet to have found the essential balance among the executive, legislative and judicial branches of government," he added. "Political power is not yet fully tethered to law."

Though he did not mention him by name, Powell's comments may have been an allusion to the October arrest of Russian businessman Mikhail Khodorkovsky, whose prosecution is widely seen as politically motivated.

PUTIN READIES FOR RE-ELECTION

Powell's concerns come as Putin prepares for almost certain election to a second four-year term in March, his opponents either unwilling to challenge him directly or unable to muster enough support to pose any real threat.

Powell also appeared to allude to December's parliamentary election in which Russia's main liberal parties were crushed by the pro-Putin party after a campaign tainted by criticism of biased coverage by state-controlled media.

"Key aspects of civil society -- free media and political party development, for example -- have not yet sustained an independent presence," Powell wrote.

Powell made clear he was worried about Moscow's assertive dealings with its neighbors, which include a territorial dispute with Ukraine over part of the Sea of Azov and the continued presence of Russian troops in Moldova and Georgia.

"Certain aspects of internal Russian policy in Chechnya, and toward neighbors that emerged from the former Soviet Union, have concerned us," he wrote.

"We recognize Russia's territorial integrity and its natural interest in lands that abut it," he added. "But we recognize no less the sovereign integrity of Russia's neighbors and their rights to peaceful and respectful relations across their borders, as well."