At Moscow's first Eurovision event on Wednesday, Dima Bilan sang a cappella, Russian folk dancers glided to balalaikas and Mayor Yury Luzhkov promised that gay fans would have a good time in Moscow -- as long as they didn't hold a gay parade.

Belgrade Mayor Dragan Dilas handed over a giant key ring with Perspex symbols of each city that has hosted the Eurovision Song Contest to Luzhkov at a ceremony to kick off Moscow's preparations for the contest, which will be held at Olimpiisky Stadium and culminate with finals in the Luzhniki Stadium on May 16.

The ceremony began with a short film about last year's event, set to Russia's winning song, "Believe," performed by Bilan. Clips showed Bilan crying, waving a Russian flag and embracing Serbia's 2007 winner, Marija Serifovic.

Speaking fluent Russian, Belgrade's mayor said he felt the "hospitality and friendship of Moscow and Russia." He then kissed Luzhkov twice on the cheek, although the Moscow mayor chose not to reciprocate.

"With pleasant anxiety, I take on the baton and the keys to one of the most outstanding cultural events that is held annually in various countries and attracts enormous attention from the cultural community in not only Europe but the whole world," Luzhkov said.

Igor Tabakov / MT Belgrade Mayor Dragan Dilas handing Mayor Yury Luzhkov the keys to the Eurovision Song Contest during a ceremony Wednesday that kicks off Moscow's preparations for Europe's top musical competition. Luzhkov said gay fans were welcome to the May finals if they didn't hold a parade.

"Moscow in its Olimpiisky Stadium will do everything so that this Eurovision 2009 festival becomes a new step in the development of pop music. We want to give this step to the world, to give yet another gift to world civilization," Luzhkov said, possibly referring to Bilan's winning song as the first gift.

"I think we won't drop this heavy burden," he concluded, waving the key ring.

Then it was time for Bilan to appear onstage with a new spiky hairdo replacing his trademark mullet and wearing a dark jacket and tight jeans. He gave a breathless speech about his victory. "Believe me, this dream came true in my life," he said. "I still can't believe that Eurovision is coming to Moscow."

He was going to leave the stage, but Channel One presenter Yana Churikova, who will host Moscow's contest, asked him for a song. Bilan launched into a note-perfect rendition of "Believe," his voice overpowering the crackly sound system.

Churikova then introduced an act that "represents our country" -- a performance by a dance troupe called Gzhel, famed for its gliding steps. The dancers in white gauzy costumes wore headdresses decorated with crosses and onion domes.

As the dancers glided offstage, Luzhkov, his deputy Valery Vinogradov, Bilan, Channel One director Konstantin Ernst and Eurovision executive supervisor Svante Stockselius came out to hold a news conference.

Ernst said the economic crisis had affected the show's initial planning but that viewers won't notice any difference. "I assure you it will not affect the way the contest is held," he said.

Vinogradov declined to answer a question about how much the city would spend on Eurovision, saying the figure would be available in a month or so. Deputy Prime Minister Alexander Zhukov said last month that the government had earmarked 1 billion rubles ($36.5 million) for the event.

Asked whether gay fans would feel comfortable in Moscow, Luzhkov began by saying, "I don't know why you are worried about this." Luzhkov, who has banned gay parades and called them satanic, then noted that homosexuality was decriminalized in Russia in 1993.

"They are free. We don't allow gay parades. These are different things," Luzhkov said. "When you talk about the leisure activities of the sexual minorities, carry out your interests as you like, you're welcome.

"Have fun. No problem -- but not on the streets, squares, parades and through demonstrations. We have never imposed any restrictions, except on public protests," he said.

After Luzhkov left, journalists drifted away, disappointed at a no-show by pop duo t.A.T.u., which placed second in Eurovision in 2003. Many missed a brief appearance by another former contestant, flamboyant pop star Filipp Kirkorov (17th place in 1995), who modestly sat in a seat a few rows back, wearing a sober suit.