Fourteen years ago, Chinese businessman Li Demin was asked to help bail out a struggling pig farm in the Russian trading city of Ussuriysk, near the Pacific coast. Li, chairman of the Dongning Huaxin Group, a trading firm based in Heilongjiang province across the border, reluctantly agreed - but on one condition. "At the time I was trading and wasn't at all interested because I knew nothing about raising pigs. So I said I would only buy if they threw in 500 hectares," Li said. In the end, the local government offered to lease Li more land than he asked for, and more was to come. Now spanning 40,000 hectares and expected to expand further, Li's farm is the biggest in Russia's Far East and one of the largest foreign-invested agricultural projects in the country. It raises 30,000 pigs a year and grows soya beans and corn that are sold locally or shipped to China. It seems to be a natural fit. Russia's Far East Federal District, a region two-thirds the size of the United States, has a population of just 6.3 million and wide swathes of unfarmed fertile land. China is next door, its 1.4 billion people have an insatiable appetite for crops and produce, and its companies have scoured the globe to lease farmland. The local population, cut off from Russia's western-facing economy, mostly welcomes Chinese investment. Chinese firms already lease or control at least 600,000 hectares of land in the Far East. The investments could surge if Moscow were more accommodating. "When the Soviet Union collapsed, the local people didn't really know what to do, so they started encouraging us to take over the land at very cheap prices," Li said. Pavel Maslovsky, who represents the Amur region near the Chinese border in Russia's upper house, the Federation Council, said the region needed investment and fears of an influx of Chinese were misplaced. "To fear that investors would come to the wrong sector and in a manner which we do not like is like selling a bear's skin before you have caught the bear," he said. But there remains considerable ambivalence in Moscow about the region's growing dependence on China. While Russia has vowed to rejuvenate the impoverished region, it is still reluctant to rely entirely on China. "There is already a feeling (from the Russians) in the bilateral relationship that they are being outmatched, and this makes them anxious," said Bobo Lo, associate fellow at London's Chatham House. If Chinese labour left the Russian Far East, the region would grind to a halt LI DEMIN, DONGNING HUAXIN The Far East received US$9.9 billion of foreign investment in 2011, according to Russia's statistics agency, accounting for just 5 per cent of the amount received by Russia as a whole. Most of the money was spent on developing oil and gas in Sakhalin, off the Far East coast. Ussuriysk, about 100 km north of Vladivostok and 60 km east of the Chinese border, was one of the first areas in Russia to open up to Chinese business in the 1980s, it has also benefited from the establishment of a free trade zone that has brought investment from 26 Chinese firms since its foundation in 2006. Widespread fears about the region being flooded by Chinese migrants have not come to pass. The city has a permanent population of around 150,000 and a floating population of a few thousand Chinese traders and workers selling textiles and electronic goods. "Some say China is 'swamping' or 'yellowfying' Russia's Far East but this isn't actually happening - the Chinese just want to do business and go home," said a Chinese businessman who has been based in Ussuriysk for more than a decade. Li said local farmers now made up around 60 per cent of his workforce of 600, but the local population had dwindled, he said. "If Chinese labour left the Russian Far East, the region would grind to a halt," he said. The Chinese businessman, who did not want to give his name, said local residents and government officials understood the necessity of co-operation, but Moscow continued to impose visa restrictions that made it harder to resolve the labour and skills shortages. Despite the problems, Chinese investment still seeks to come to the Far East. Moscow would prefer a more diversified range of investors, but firms from Japan or South Korea are reluctant to get involved. Li said local authorities in the region understood the leading role that Chinese investment and Chinese labour needed to play in development. "The Russians understand that if the Chinese don't come, then who?" he said. "Would the Japanese come, or the Koreans?"