* Putin says Snowden in transit area at airport, free to go
* U.S. having discussions with Russia
President Vladimir Putin confirmed on Tuesday a former U.S. spy agency contractor sought by the United States was in the transit area of a Moscow airport but ruled out handing him over to Washington, dismissing U.S. criticisms as "ravings and rubbish".
His refusal to hand back Edward Snowden risked deepening a rift with the United States that has also sucked in China and threatens relations between countries that may be essential in settling global conflicts including the Syrian war.
China rejected U.S. criticism for letting Snowden flee the Chinese colony of Hong Kong as "baseless".
In his first public comments on Snowden since the fugitive flew in on Sunday, Putin said the 30-year-old American was in the transit area of Moscow's Sheremetyevo airport, not having gone through passport control, was free to leave and should do so as soon as he could.
Snowden has applied for asylum in Ecuador but Quito has said it is still considering the application and the United States is trying to persuade the governments of countries where he might head to hand him over.
"He has not crossed the state's border, and therefore does not need a visa. And any accusations against Russia (of aiding him) are ravings and rubbish," Putin told a news conference during a visit to Finland.
Making clear Moscow saw no gain in extraditing Snowden, he said: "It's like giving a baby pig a haircut: there's a lot of squealing, but there's little wool."
"We can hand over foreign citizens to countries with which we have an appropriate international agreement on the extradition of criminals. We don't have such an agreement with the United States ... Thank God, Mr Snowden committed no crimes on the territory of the Russian Federation."
His words appeared a direct rebuff to U.S. Secretary of State John Kerry, speaking only hours earlier.
The U.S. State Department said diplomats and Justice Department officials were talking to Russia, suggesting they sought a deal to secure his return to face espionage charges.
Journalists camped out at the airport have not spotted him inside, or leaving, the transit area. He has not registered at a hotel in the transit zone, hotel sources say.
A receptionist at the Capsule Hotel "Air Express", a complex of 47 basic rooms furnished predominantly with grey carpets and grey walls, said Snowden had turned up on Sunday, looked at the price list and then left.
U.S. officials admonished Beijing and Moscow on Monday for allowing Snowden to escape their clutches but the United States' partners on the U.N. Security Council, already at odds with Washington over the conflict in Syria, hit back indignantly.
"The United States' criticism of China's central government is baseless. China absolutely cannot accept it," Foreign Ministry spokeswoman Hua Chunying said in Beijing, also dismissing U.S. criticism of Hong Kong, a Chinese territory, for letting Snowden leave.
There has been speculation in the Russian media that Snowden may be talking to the FSB security service, a successor of the Soviet-era KGB, and could be involved in a prisoner swap.
Putin said Russian security agencies "never worked with... Snowden and are not working with him today".
Fallout from a protracted wrangle over Snowden could be far-reaching, as Russia, the United States and China hold veto powers at the U.N. Security Council and their broad agreement could be vital to any settlement in Syria.
International mediator Lakhdar Brahimi said on Tuesday he was pessimistic an international conference on Syria could take place in July as hoped and urged Russia and the United States to help contain a conflict which has killed almost 100,000 people.
The Sheremetyevo airport transit area is Russian sovereign territory, but Russia says that in staying there Snowden has not formally entered the country. Going through passport control might implicate Putin in helping a fugitive.
"The sooner he chooses his final destination, the better it would be for us and for himself," Putin said.
Snowden is travelling on a refugee document of passage provided by Ecuador, WikiLeaks said.
U.S. officials said intelligence agencies were concerned they did not know how much sensitive material Snowden had and that he may have taken more documents than initially estimated which could get into the hands of foreign intelligence.