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Juha Sipila of the Centre Party is pictured after he was voted to become the next prime minister at the parliament in Helsinki May 28, 2015. Vesa Moilanen/Lehtikuva via REUTERS/File Photo

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HELSINKI (Reuters) - If Finland joined NATO it would lead to a serious crisis with neighbouring Russia, a report commissioned by the Finnish government said on Friday.

Membership of the military alliance would strengthen Finland's security but trigger a harsh reaction from the Kremlin, affecting trade between the countries, according to the report prepared for Prime Minister Juha Sipila's centre-right government.

Militarily-neutral Finland shares a 1,340 km-long border and difficult history with Russia, its former ruler.

The report gave no direct recommendation on whether Finland should seek membership, but said a joint Finnish-Swedish application would be a better strategic option than either Nordic country joining the alliance alone.

"This is a question of grand strategy," Finnish Prime Minister Sipila told reporters on Friday.

"Small nations do not often change their basic foreign policy guidelines," he said, adding that leeway was needed in case the security situation changed.

Only 22 percent of Finns support joining NATO, while 55 percent are opposed, a recent poll by public broadcaster YLE showed.

Finnish membership of NATO would double the length of the border between the alliance and Russia and increase the NATO presence in the Baltic Sea.

But without Sweden, Finland would be an isolated outpost which NATO would have difficulty defending, the report said.

Sipila said the governments of Finland and Sweden had promised not to "surprise each other" on the issue.

Nordic countries have stepped up military cooperation since Russia's annexation of Crimea in 2014.

This month two Russian warplanes flew simulated attack passes near a U.S. destroyer in international waters in the Baltic, according to the U.S. military.

On Friday, Russian Foreign Minister Sergei Lavrov said in an interview that if Sweden joined NATO, Moscow would take "necessary military-technical measures".

Sweden's government has said it will not join the alliance, but four opposition parties want membership.

Finland won independence during Russia's revolution of 1917 but nearly lost it fighting the Soviet Union in World War Two.

It kept close economic and political ties with the West during the Cold War but avoided confrontation with Moscow.

(Reporting by Tuomas Forsell and Jussi Rosendahl; Additional reporting by Simon Johnson in Stockholm; Editing by Andrew Roche)

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