"Construction of the pipeline from East Siberia to the Pacific Ocean opens up great prospects," Putin said. "We plan to build the pipeline to the Pacific coast with eventual supplies to the Asia-Pacific region, including Japan.
Japan has been seeking guarantees that the pipeline would go to the Pacific instead of to China.
Putin, speaking to a Russian-Japanese business forum, called on Japanese companies to invest more in Russia, saying Japan accounts for just 1 percent of foreign investment in the country.
The Russian leader also noted that Moscow and Tokyo have successfully completed talks in which Japan will support Russia's future membership in the World Trade Organization.
Putin later went into talks with Prime Minister Junichiro
The Russian and Japanese sides have been encouraging the development of economic links even as they remain split over four Pacific islands seized by Soviet forces at the end of World War II. Russia has declined Japanese demands to return the islands, which are known as the Southern Kuriles in Russia and the Northern Territories in Japan.