Moscow on Thursday accused the Western military alliance NATO of only "imagining" that Russia is a threat in the crisis gripping Ukraine. This follows a warning from NATO's top commander in Europe that the alliance was drafting "defensive" measures.

The amnesty was offered by Ukraine's acting President Oleksander Turchinov to armed pro-Russian separatists. He said he was "willing" to order that they not face prosecution if they vacated public buildings held since Sunday in Donetsk and Luhansk.

"If people lay down their arms and free the administration buildings, we guarantee that we will not launch any criminal proceedings," Turchinov told parliament in Kyiv.

This followed a warning issued by Ukrainian Interior Minister Arsen Avakov, who said that the standoffs in both cities must be resolved within two days.

"There are two options: political settlement through negotiations and the use of force," Avakov said. "We are ready for both options."

'Imaginary' threat, says Russia

The Ukrainian pronouncements coincided with a Russian Foreign Ministry claim that the 28-nation Western alliance was using the crisis in Ukraine to "rally its ranks in the face of an imaginary external threat to NATO members."

Late on Wednesday, NATO's top commander in Europe, US Air Force General Philip Breedlove said by next Tuesday he would present NATO foreign ministers with a "package of land, air and maritime measures that would build assurances for our easternmost allies."

Estonia and Romania are among the NATO members closest to the crisis region bounded by the Black and Baltic seas.

Breedlove told the news agency Associated Press that Russia had "a force of about 40,000 deployed at locations each of the Ukraine-Russian border "ready to go" within 12 hours.

It would intimidate Ukraine by its presence or push along the Black Sea coast - passed Crimea - annexed by Russia last month - to the Ukrainian port city of Odessa and Trans-Dniester enclave of Moldova.

NATO is already conducting daily AWACs surveillance flights over its member states Poland and Romania and has reinforced air patrols over the Baltic region.

Everything NATO was preparing was completely "defensive in nature," Breedlove said.

Russia's deputy defense minister Anatoly Antonov had on Wednesday accused the West of spreading "horror stories" about Russian troop movements. He warned NATO against considering troop movements close to Russia.

The US assistant secretary of state for European affairs, Victoria Nuland said Washington regarded four-way talks due next week - to include Russia, Ukraine and Europe - as "very important."

She went on to warn Russian President Vladimir Putin that "NATO territory is inviolable."

Economic pressure

In Washington on Thursday the Ukraine crisis was expected to dominate talks among finance ministers of the Group of Seven (G7) industrial powers.

Diplomatic sources said those consultations would take place ahead of a G20 finance and central banker meeting in Washington.

President Putin said on Wednesday that Russia would demand that Ukraine provide advance payment for gas supplies. Moscow had already eliminated a gas discount previously granted to Ukraine.

On Wednesday, European Commission President Jose Manuel Barroso said an EU support group comprising 30 full-time officials was being formed to assist Ukraine's interim government.

The Commission said it would be coordinated by the EU's commission for neighborhood affairs, Stefan Fuele.

ipj/pfd(dpa, AFP, AP, Reuters)