"If you consider all parts of the equation, Zenit (St Petersburg), Arsenal, Arshavin, it was a good decision for everyone," Hiddink told Reuters in an interview at the national team's training camp at this Mediterranean resort.
"Zenit did a lot for Arshavin but he paid them back and at his age it was time to make a change. The move will bring great dividends to Arsenal and Arshavin as well as Russian football as a whole."
The product of a local youth academy, the 27-year-old from St Petersburg had only played for Zenit before joining Arsenal last week for a club record fee of 15 million pounds ($21.35 million).
Hiddink said Arsene Wenger, the manager of the English Premier League club, called him to discuss the player he eventually signed on a three and a half year contract.
"We talked last week about Arshavin, what he's like as a player, as a person," the Dutchman said.
"Arsenal's playing style, a short-passing, fast game, will suit Arshavin."
The playmaker was linked with several top clubs in England and Spain after lighting up Euro 2008 with his nifty footwork and helping Russia reach the semi-finals.
TEAM LEADER
Hiddink said Arshavin had matured into a team leader over the past two years.
"When I first met him almost two and a half years ago he, just like most other Russian players, was a very closed person, didn't talk much," the coach recalled.
"But no matter where I've worked, whether it's Russia, South Korea, Australia or Holland, I've always tried to challenge the players to do more and that was also the case with Arshavin.
"After a certain time he has come out of his shell, has established himself as one of the team leaders."
Hiddink made Arshavin his skipper in 2007 before stripping him of the captaincy later that year after he was sent off for kicking an opponent in Russia's final Euro 2008 qualifier in Andorra.
Arshavin was banned for the first two matches of Euro 2008. He returned for the final group match against Sweden, helping his side reach the knockout stages.
The playmaker then produced a brilliant display in the 3-1 quarter-final win over Netherlands, scoring one of the goals as Russia qualified for the last four of a major tournament for the first time in 20 years.
"He (Arshavin) is what you call a game breaker, he can decide the outcome of any match and he perfectly illustrated that in the game against Holland," Hiddink said.
"I would say those qualities of Arshavin, along with being a very smart and mentally tough player, have convinced Arsene Wenger to sign him."
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