Fresh Ukraine clashes kill 2 as rebels plan new 'state'

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Fresh Ukraine clashes kill 2 as rebels plan new 'state'

Fresh Ukraine clashes kill 2 as rebels plan new 'state'

Kiev (AFP) - Fresh clashes in east Ukraine left two soldiers dead Wednesday in a spike in fighting as a key rebel leader announced he planned to create a new "state".

Kiev said the two servicemen were killed by shelling from Russian-backed rebels some 40 kilometres north of the insurgent capital Donetsk, the deadliest daily toll in two weeks.

"The situation in the anti-terrorist operation zone has seriously worsened," the Ukrainian army said in a statement.

Another four soldiers and two civilians were wounded in mortar fire, it said, accusing rebels of using heavy weapons banned by ceasefire agreements.

The latest flare-up in the conflict that has dragged on for over three years comes after Donetsk rebel chief Alexander Zakharchenko on Tuesday announced plans to create a new "state" to replace Ukraine.

The proposed new country is to be called Malorossiya (Little Russia) -- a tsarist-era term for an area covering much of modern day Ukraine -- and have its capital in Donetsk.

The surprise plan quickly unravelled as Kiev and its allies in the West denounced it, and even Zakharchenko's backers in the Kremlin labelled it his "private initiative".

The press service for the top rebel in the neighbouring Lugansk region Igor Plotnitsky said he had not agreed to the idea.

The announcement sparked fears it could drive another nail into the coffin of a stalled peace process that has failed to end a conflict that has claimed 10,000 lives.

A deal brokered by the leaders of Ukraine, Russia, France and Germany in the Belarusian capital Minsk in 2015 has hit a wall but is still viewed by those involved as the only way of unwinding Ukraine's war.