THE Government has warned Russia that the dispute with Georgia could affect Australia's plans to sell billions of dollars' worth of uranium to Moscow.

The Minister for Foreign Affairs, Stephen Smith, said yesterday he had instructed officials from the Department of Foreign Affairs and Trade to meet the Russian Ambassador, Alexander Blokhin, to advise that Russia's actions in Georgia could affect the deal.

"When considering ratification, the Government will take into account not just the merits of the agreement but recent and ongoing events in Georgia and the state of Australia's bilateral relationship with the Russian Federation," Mr Smith told Parliament.

The Howard government signed a deal in September with the then Russian president, Vladimir Putin, to allow Russia to buy uranium for its domestic nuclear energy program. The deal, which is yet to be ratified, limits its use to "peaceful, non-military purposes".

Mr Blokhin, who met Mr Smith last week, said yesterday that a failure to ratify the deal would damage the economies of both countries and be regarded by Russia as "politically biased".

"We do not see any connection between the events in the Caucasus region and the uranium deal," he said.

"These are completely separate things. The agreement on uranium is actually an agreement about the use of atomic energy only for peaceful civilian aims … If this agreement is not ratified, in that case we could regard that as an obversely political biased decision, which could harm the economic interests of Australia as well."

The deal was yesterday considered by the Joint Standing Committee on Treaties, whose chairman, Kelvin Thomson, a Labor MP, said he was concerned Mr Putin, who is now Russian Prime Minister, would renege on the pledge to use the uranium for peaceful purposes.

"I don't know if you've looked on the TV into Vladimir Putin's eyes - he is one tough son of a gun and I don't think that he cares about what we think," Mr Thomson said during the hearing.

"I think that we could supply uranium to him and if he changed his mind about the uses to which he was going to put it, I don't think we'd have any effective comeback at all."

But the director-general of the Australian Safeguards and Non-proliferation Office, John Carlson, said Russia needed the uranium to meet future energy demands and was unlikely to breach the agreement.