Germany's decision to deploy a battalion of troops to Lithuania under a NATO initiative marks a "mindset breakthrough" for Berlin towards taking a leading role in European defence, the Lithuanian president said Thursday.

"I think we are at a historic turning point," Dalia Grybauskaite said in an interview with AFP in Vilnius on the eve of a key NATO summit, which will to seal its biggest revamp since the Cold War to counter a resurgent Russia.

"A breakthrough is occurring in the German mindset -- time for self-doubt, fear, reluctance to take responsibility, and dread of what Putin might think, is over," she added, referring to the strongman Russian president.

Fears that Russia could attempt to attack NATO's three small formerly Soviet-ruled Baltic member states surged after Moscow's 2014 annexation of Crimea from Ukraine, a move that sent East-West relations to their lowest point since the Cold War.

NATO leaders on Friday will finalise plans to deploy four battalions to the Baltic nations and Poland.

Germany will lead a battalion deployed to Lithuania, Canada to Latvia, Britain to Estonia and the United States to Poland, diplomats told AFP on condition of anonymity. Each battalion will have 600-1,000 troops.

The historic burden of Nazism has made EU heavyweight Germany a reluctant military leader, but Grybauskaite said Berlin's role in security will only increase once Britain leaves the bloc.

"With Britain withdrawing from the EU ... responsibility for stability in Europe will increasingly fall on the shoulders of Germany -- not only for economic stability, but also for security," Grybauskaite said.

"No matter what we think about elections in the US, we can witness the strategic direction that the United States will hand over more security responsibility to Europeans," she added.

- 'Trust is lost' -

German Chancellor Angela Merkel said Thursday in Berlin that Russia's actions in Ukraine had eroded mutual trust with the West.

"If through words and deeds the validity of (international) law and the inviolability of borders are questioned, then of course trust is lost," she told the German parliament.

When NATO leaders meet in Warsaw, "it will be at a time in which the security situation has significantly changed in Europe," she said, also pointing at turmoil in Syria, Iraq and Libya.

Grybauskaite also dismissed Russian accusations of the US-led alliance provoking an arms race in the region, insisting the West was simply reacting to Moscow's moves in Ukraine.

NATO will hold fresh talks with Russia on July 13, just days after the landmark alliance summit.

The NATO-Russia Council (NRC) brings together ambassadors from the 28 NATO member states and Russia, and met regularly until the Ukraine crisis plunged relations with Moscow into the deep freeze.

Russia's ambassador to NATO Alexander Grushko told AFP: "The main focus will be on the military security in the wake of decisions to be taken at the NATO summit in Warsaw.

"We hope for a frank and serious dialogue on the issues related to the increased NATO activities near Russian borders and their impact on the security and stability in Europe and its regions."

US permanent representative to NATO Douglas Lute said Thursday that "from NATO's perspective, the foundation of our relationship with Russia is a balance between strength and dialogue.

"We're going to do what we need to do on the strength side of the equation, but we'll equally be open to dialogue with Russia, because we think that balance represents the right and responsible approach to NATO-Russia relations."