Obama grants Russia 'permanent normal trade relations'

U.S. President Barack Obama gestures as he speaks to the media about the ''fiscal cliff'' in the White House Briefing Room in Washington December 19, 2012.

WASHINGTON (Reuters) - President Barack Obama on Thursday formally granted "permanent normal trade relations" to Russia, following congressional action that cleared the way for him to remove a Cold War-era vestige on trade but also raised tensions with Moscow.

"The Russian Federation has been found to be in full compliance with the freedom of emigration requirement" under the 1974 Jackson-Vanik amendment, Obama said in a proclamation.

That provision tied favorable U.S. tariffs rates to the rights of Jews in the former Soviet Union to emigrate freely.

The House of Representatives and the Senate overwhelmingly passed legislation allowing Obama to grant permanent normal trade relations, or PNTR, to Russia in order to ensure that U.S. companies share the full benefits of Russia's recent entry in the World Trade Organization.

But Congress tied the PNTR bill to legislation to punish Russian human rights violators by barring them from visiting the United States and freezing any assets they have in U.S. banks.

Russian President Vladimir Putin on Thursday harshly criticized the new human rights measure.

"This is very bad. This, of course, poisons our relationship," Putin told his annual news conference. (Reporting By Doug Palmer; Editing by Vicki Allen)