A UKRAINIAN military spokesman has dismissed a call for a ceasefire by a separatist leader, saying this could only take place once rebels had shown 'white flags' and surrendered.

Meanwhile the separatists stepped back from their earlier talk of a possible ceasefire and said the Ukrainian army had to end military action first.

Government forces yesterday tightened the circle around the rebels' main redoubt, the big industrial city of Donetsk. Residents there reported heavy shelling from early in the day.

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A senior leader of the self-proclaimed Donetsk People's Republic had said rebels were ready for a truce with government forces to allow humanitarian aid to be brought in.

But yesterday military spokesman Andriy Lysenko said: "If there is this initiative, it should be carried out by practical means and not by words - by raising white flags and putting down guns. We have not seen these practical steps yet," he said.

In a statement released later the rebels said they remained ready for a temporary truce to head off "a humanitarian catastrophe".

But they added, defiantly: "As long as the Ukrainian army is continuing military action there can be no ceasefire."