Kiev: Ukraine claimed it had regained control of swathes of the separatist east on Friday even as Washington expressed concern over the appearance of fighters from Russia`s war-ravaged region of Chechnya among the insurgents.
The rebels for their part dismissed speculation of a rift in their ranks after a dozen local militants were evicted from their seat of power in Donetsk by a military brigade comprised largely of Chechens and other Russians from the volatile North Caucasus.
Both Kiev and its Western allies have long accused the Kremlin of choreographing a seven-week insurgency that has shaken Ukraine`s foundations -- a charge that Russian President Vladimir Putin denies.
But the recent appearance among the separatists of trained gunmen from Chechnya -- a mostly Muslim region that fell under Kremlin control following two post-Soviet wars for independence -- has fuelled fears of the conflict being transformed into a proxy war involving elements from other unstable regions of the former Soviet Union.
Ukraine`s acting defence minister said his forces were in high spirits despite the downing of a military helicopter on Thursday by the rebels that killed 11 soldiers and a general.
"Our armed forces have completed their assigned missions and completely cleared the southern and western parts of the Donetsk region and the northern part of the Lugansk region from the separatists," Mykhailo Koval told reporters.
Pro-Russian militants seized about a dozen towns and cities in the two eastern industrial regions in response to the popular ouster in Kiev of a Kremlin-backed president.
Rebels in control of the Lugansk and Donetsk government buildings have declared independence and are seeking a merger with Russia similar to that accomplished by Ukraine`s Black Sea peninsula of Crimea following its seizure by pro-Kremlin troops in March.
Ukraine`s acting defence chief said his soldiers intended to push ahead with their so-called "anti-terrorist operation" despite demands by Moscow for all military activities to come to an immediate halt.
"We will continue working until this region starts working and leading a normal life," said Koval.
Ukraine`s acting president Petro Poroshenko also vowed to punish those who used a sophisticated surface-to-air missile to shoot the MI-8 helicopter out of the Lugansk sky.
"We have to do everything we can to ensure no more Ukrainians die at the hands of terrorists and bandits. These criminal acts by the enemies of the Ukrainian people will not go unpunished," Poroshenko told Ukrainian news agencies.Poroshenko -- a 48-year-old confectionary tycoon who backs closer ties with Europe but once enjoyed good relations with top Russian officials -- won nearly 55 percent of Sunday`s presidential ballot thanks to a message focused on bringing a quick end to the separatist drive.
He has since reached out to Putin and promised to hold his first talks with the Russian leader when they both attend D-Day commemorations in Normandy on June 6.
But Putin has yet to confirm the meeting. Late on Thursday, Washington again called on Moscow to take a more constructive approach.
US Secretary of State John Kerry said he was encouraged by signs that Russia was pulling its troops back from Ukraine`s eastern border.
But he said the appearance of Chechens in Donetsk and Lugansk was a dangerous new development that Putin should quickly address.
"There are still danger signs there that we hope will change," the top US diplomat told PBS television.
"There is evidence of Russians crossing over, trained personnel from Chechnya trained in Russia who`ve come across to stir things up, to engage in fighting," he said.
"We hope the Russians would actually engage more proactively in efforts to now try to de-escalate, take advantage of the election, build a road forward where Ukraine becomes a bridge between the West and East."
Chechnya`s strongman leader Ramzan Kadyrov has denied sending his fighters into Ukraine.
But he also added that he could not account for the actions of all Chechens while the Kremlin has steered clear of the topic to this point.Ukraine`s cash-strapped government hopes to avert another immediate threat when the European Union holds last-gasp talks in Berlin on Friday in a bid to avert a possible cutoff of Russian gas supplies.
Kiev missed a midnight Thursday deadline to pay Russia $2 billion (1.5 billion euros) under an EU-brokered agreement or face a halt in gas supplies next week that would also hit parts of Europe.
Russia and Ukraine launched their third gas war in less than a decade after Moscow decided to cancel its previous rebates and nearly double the price it charges Kiev for gas after the Kremlin-backed president`s fall.
Ukraine refused to pay in protest and has since baulked at the terms of an interim deal negotiated with the help of a top EU energy official that would have seen Russia receive a down payment on Kiev`s debt by Thursday night.
Russia`s state-owned natural gas giant Gazprom said a failure to pay will scuttle negotiations on a lower gas price and prompt it to proceed with a cut-off that would hit parts of Europe next Tuesday unless a larger payment of more than $5 billion (3.7 billion euros) is made by Monday night.
About 15 percent of all gas consumed in Europe is pumped in from Russia through Ukraine and analysts said it was in both sides` interest to find a compromise.