Met Police barrister Richard Horwell QC said suspects Dmitry Kovtun and Andrei Lugovoi had no personal motive to kill.
The Russian state "is likely to have been the sponsor of this plot" and had "reasons aplenty" for wishing him "not only harm, but death", he said.
UK officials believe the two suspects poisoned Mr Litvinenko, 43, in London in 2006 but they deny any wrongdoing.
Mr Litvinenko drank tea containing a fatal dose of radioactive substance polonium-210 during a meeting with Mr Kovtun and Mr Lugovoi.
He died in hospital nearly three weeks later.
The fact that polonium caused his death indicates there was some form of Russian state participation, Mr Horwell said in his closing remarks.
He said: "The evidence suggests the only credible explanation is that in one form or another the Russian state was involved in Mr Litvinenko's murder."
However, he stressed this did not mean Russian President Vladimir Putin was involved or gave the order and that there were many possible motives for the murder.
Defecting to the UK in 2000, after accusing KGB successor the FSB of murdering political opponents and of corruption, could have been seen as "akin to treachery", he said.
He also spoke of Mr Litvinenko's "many personal attacks on Putin".
Mr Horwell has said the risk to the general public in London from polonium radiation will never be known, and also that Mr Litvinenko had been poisoned twice in the run-up to his death.
He said: "The two attacks on Mr Litvinenko were an outrage. They led to great suffering on his part and eventually to his demise.
"We will never know how dangerous the exposure of polonium to the public at large will be and what long-term effects will be visited upon Londoners."
Mr Horwell said the suspects left a "trail of polonium" behind and they had "no credible answer" to the scientific evidence against them.
While the force wanted them tried for murder, this was now unlikely to happen, the inquiry heard.
Attempts to extradite the two men have failed and they remain in Russia.
Former Soviet army officer Mr Kovtun has been criticised by inquiry chairman Sir Robert Owen for failing to give evidence to the hearing.
The inquiry was adjourned until Friday.
The Russian state wanted former spy Alexander Litvinenko dead, the inquiry into his poisoning has been told.