By Andrius Sytas

VILNIUS (Reuters) - The Lithuanian parliament appointed Saulius Skvernelis, a defense hawk and former interior minister affiliated to the Lithuanian Peasants and Greens Union, as prime minister on Tuesday.

The move comes after the party emerged as surprise winners of last month's general election in which voters rejected established political parties.

Skvernelis says he will keep Lithuania's pro-European policy, and, in the face of a resurgent Russia, pledged to increase country's defense spending above NATO's informal threshold of 2 percent of gross domestic product after 2018.

His nomination comes amid worries in the Baltics states that Russia, their former Soviet master, might act to grab them back by force following its annexation of Crimea in 2014.

"We do not have a luxury to increase defense spending slowly, we must send clear signal to our partners and countries in the region that we look after our defense responsibly", Skvernelis told parliament in an address last week.

The new prime minister, 46, first built a reputation as Lithuania's police chief for his campaign to stamp out corruption in country's force and cut its staff numbers.

He was tapped to head the interior ministry in 2014 but resigned the following year in a row over a decision to issue the country's policemen with AK-47 rifle. He was told, however, top keep his job by the prime minister.

A homeless man was accidentally shot and a suspected drug addict stole one of the weapons from a police car before evading a police manhunt. The AK-47s, issued as a precaution after Paris attacks, were withdrawn soon thereafter.

Skvernelis remained popular in the polls and successfully led the Peasants and Greens effort in the general election, while refusing to join the party as a member.

The Peasants and Greens, with 54 seats in the 141-seat parliament, emerged as the biggest party in a late-October election, ousting a coalition of the Social Democrats, Labour and Order and Justice parties which had been in power since 2012. The new government takes over in December.

An also-ran in previous elections, the party created a coalition with Social Democrats and a number of independent law makers, giving them a workable majority.

(Reporting By Andrius Sytas; Editing by Alistair Scrutton/Jeremy Gaunt)