Could business between Russia and Europe be on the cusp of a thaw?

President Putin has called for a mending of ties as European business leaders attended Russia's top economic conference after a two-year absence.

Russian President Vladimir Putin called on European leaders Friday to heal ties with his country despite sanctions after meeting with European investors who said they want to expand their businesses there.

Speaking at Russia's top economic conference, President Putin said top German and French investors expressed their interest to invest more in Russia despite the weight of the sanctions, some of which the European Union extended just as Putin was speaking.

"Politicians should meet the businessmen halfway, show wisdom, long-term thinking and flexibility," Putin said. "We need to bring back trust to Russia-European relations and restore the level of cooperation." Russia, he said, doesn't need a new Cold War.

He made a point to stress that Russia's ban on EU foodstuffs and other retaliatory measures were imposed "in response" to the EU sanctions.

"We don't bear grudges and we are willing to meet our European partners halfway — this, however, must not be a one-way street," he added.

Putin criticized the West for ignoring Russia's legitimate interests. He said there is no reason for NATO's continued expansion, and noted that the US-led NATO missile defense plans pose a threat to Russia.

US Defense officials are keen to retain the "possibility of partnership" with Russia, yet determined to pour all necessary resources into the European Reassurance Initiative, as The Christian Science Monitor's Anna Mulrine reported last month. 

Western leaders and company executives went to Russia's St. Petersburg Economic Forum this year after a two-year break that felt like a boycott, signaling a growing fatigue in some parts of Europe over the sanctions. The Russian ban on food imports has hurt agricultural exporters like Greece and Italy.

Putin had a meeting with the CEO of Royal Dutch Shell on Thursday and other international executives, telling them that Russia is open to Western investment despite the strained ties.

Alexei Pushkov, the chairman of the foreign affairs committee at the Russian parliament, said on Twitter on Friday that "the dynamics" at the St. Petersburg gathering "shows that the restoration of ties between Russia and the EU will be slow and contradictory but inevitable."

The United States and the European Union slapped Russia with economic sanctions in 2014 after it annexed Ukraine's Crimea peninsula and threw its backing to separatist rebels in eastern Ukraine. Moscow retaliated by banning imports of meat, vegetable and dairy products from the EU.

As Putin was delivering his speech in St. Petersburg, the EU extended for another year some of its sanctions targeting Russia. They target imports from the Crimean peninsula and investment there, among other measures. On top of that, cruise ships from the EU cannot call at ports there, in an attempt to hurt the tourism industry.

The EU currently also has other sanctions targeting Russia more directly, limiting access to Russian companies to Western capital markets, banning arms trade and limiting access to sensitive oil industry technologies. It also has slapped asset freezes and travel restrictions on 146 people and 37 entities. Some of these sanctions need to be extended in the coming weeks and months.

The announcement came a day after EU Commission President Jean-Claude Juncker met with Putin in St. Petersburg. Mr. Juncker, the highest ranking EU official to visit Russia since the Crimean annexation, told the forum on Thursday that the EU needs to engage with Russia despite the painful sanctions exchanged over the past two years.

Vladimir Chizhov, Russia's envoy to the EU, told the RIA Novosti news agency that Friday's decision by the EU to extend the sanctions was no surprise for Russia. But he suggested it was not a foregone conclusion that the other, more direct sanctions against Russia would be extended in coming weeks.

"Let's see what happens next," he said.

Raf Casert in Brussels contributed to this report.