Vladimir Putin says Crimea now independent, defying the West

Moscow: President Vladimir V. Putin of Russia signed a decree on Monday formally recognizing Crimea as a "sovereign and independent state," laying the groundwork for annexation and defying the United States and Europe just hours after they imposed their first financial sanctions against Moscow since the crisis in Ukraine began.

Putin issued his late-night decree after the region declared independence earlier in the day and asked Russia to annex it in keeping with results of a referendum conducted Sunday under the watch of Russian troops. The Kremlin announced that Putin would address both houses of the Russian Parliament on Tuesday, when many expect him to endorse annexation.

The moves indicated that Moscow remained undaunted by Western pressure in a clash of wills that has created the most profound rift in East-West relations since the end of the Cold War, and which threatens the redrawn borders created after the breakup of the Soviet Union in 1991. Every time the United States and Europe have tried to draw a line in recent weeks, Putin has vaulted past it. The White House indicated that it had held back going after some in Putin's inner circle in order to have room for its next countermove.

The decree signed on Monday effectively raised the ante on President Barack Obama after he froze assets and banned travel for 11 Russian and Ukrainian figures, including Vladislav Surkov, a longtime adviser to Putin; Dmitry O. Rogozin, a deputy prime minister of Russia; and Valentina I. Matviyenko, a Putin ally and the chairwoman of the Federation Council, the upper house of Russia's Parliament. The European Union followed with sanctions against 21 Russian and Ukrainian figures. The sweep of the sanctions was viewed as relatively modest, but Obama signaled he may go further by signing an executive order authorizing future sanctions against Russia's arms industry and the wealthy business figures who support Putin's ruling clique.

"We're making it clear that there are consequences for their actions," Obama said as he announced the sanctions. "We'll continue to make clear to Russia that further provocations will achieve nothing except to further isolate Russia and diminish its place in the world."

In Simferopol, the Crimean capital, celebrations continued Monday, and officials declared it a day off from work as officials announced that 97 percent of voters in Sunday's referendum supported rejoining Russia. Legislators moved to complete the break from Ukraine, adopting a resolution declaring that the laws of Ukraine no longer applied to Crimea and that state funds and property in Crimea had been transferred to their new entity.

Highlighting the tensions, the Ukrainian Parliament in Kiev approved a presidential decree authorizing the call-up of 20,000 reservists, and another 20,000 for a newly formed national guard. The interim government also increased the military budget with an emergency allotment of about $680 million.

Moscow moved to welcome back Crimea, which was part of Russia for much of the past few centuries, until the Kremlin transferred it to control of the Ukrainian Republic inside the Soviet Union in 1954; it remained under Ukraine when it became a separate country in 1991. Every faction in the Russian Duma submitted draft legislation on Monday officially reversing that 60-year-old decision.

The consensus in Moscow was so strong that even the last Soviet leader, Mikhail S. Gorbachev, whose role in the dissolution of the Soviet Union is deeply reviled in Russia, endorsed Crimea's move, telling Interfax that its independence "should be welcomed and not met with the announcement of sanctions."

He added: "If until now Crimea had been joined to Ukraine because of Soviet laws that were taken without asking the people, then now the people have decided to rectify this error."

The U.S. sanctions targeted prominent Russian officials, but not those likely to have many overseas assets; the European list went after generally lower level targets. As a result, the actions were met with derision and even mockery in Moscow. In one measure of the reaction, Russia's battered stock markets rose sharply at the end of the day.

"This is a big honor for me," said Surkov, once called the "gray cardinal" of the

Kremlin and known as the architect of Putin's highly centralized political system. He told a Russian newspaper that he had no assets abroad: "In the U.S., I'm interested in Tupac Shakur, Allen Ginsberg and Jackson Pollock. I don't need a visa to access their work."

Rogozin, who oversees the defense industry, chided "Comrade Obama" in a Twitter message noting that those on the list did not have assets abroad. Andrey Klishas, a member of the Federation Council, told Interfax that the measures against him "were no tragedy for me." Yelena Mizulina, a member of the State Duma, the lower house of Parliament, said in an email statement that she considered the sanctions "a rude violation of my rights and freedoms as a citizen and a politician."

Others singled out by the United States on Monday were Sergei Glazyev, an economist who has been advising Putin on Ukraine; and Leonid Slutsky, another Duma member. Obama did not go after Putin or others in his inner circle.

The United States issued sanctions against two Russian-supported figures who have taken power in Crimea - Sergei Aksyonov, the newly declared prime minister; and Vladimir Konstantinov, the speaker of its Parliament.

It also penalized Viktor F. Yanukovych, the former Ukrainian president and Moscow ally whose ouster amid pro-Western street protests last month led to the Russian invasion of Crimea; and Viktor Medvedchuk, leader of a pro-Russia civil society group, Ukrainian Choice.

The European list for sanctions included Aksyonov, Konstantinov, Klishas and Slutsky. Overall, the Europeans targeted 10 Russian politicians, seven pro-Russian Crimeans, three Russian military officers in Crimea and the former leader of Ukraine's Black Sea Fleet, who defected to Russia this month. But the Europeans declined to go after elite figures like Surkov and Rogozin out of reluctance to poke Putin too directly.

Asked whether the European Union had failed to match tough words with strong actions, Radoslaw Sikorski, the Polish foreign minister, told journalists: "The U.S. is from Mars and Europe is from Venus. Get used to it."

He noted that "Europe is closer and will therefore pay a bigger cost for sanctions against Russia." He also pointed to Europe's collective decision-making process.

"In the United States, one man takes a decision on the basis of an executive order," Sikorski said, "whereas in Europe, for these measures to be legal, we need a consensus of 28 member states."

Diplomats said some European countries wanted to include as a sanctions target Dmitry K. Kiselyov, a Russian television anchor who warned during a broadcast of his country's ability to "turn America into radioactive dust." But his name was dropped amid objections from Finland and others that journalists should not be singled out, even those working for state-controlled organizations.

Chancellor Angela Merkel of Germany said the sanctions were not imposed lightly. "We wanted talks and a diplomatic solution, but the clear violation of international law yesterday with the so-called referendum meant we had to take this step, and I am glad that Europe showed such unity," she said.

U.S. officials made clear they will ratchet up the pressure if Putin does not back down. They went immediately back to the Situation Room after the announcement to begin work on a next round of sanctions that could come as early as this week. Obama's new executive order expanded the scope of his authority to target three groups: Russian government officials, the Russian arms industry and Russians who work on behalf of government officials, the latter called "Russian government cronies" by a senior U.S. official.

While targeting a limited number of individuals at first, administration officials said the scope of the new order was broader than any aimed at Moscow in decades. "These are by far the most comprehensive sanctions applied to Russia since the end of the Cold War - far and away so," said another senior official, who under the ground rules set by the administration was not identified.

The bravado in Moscow struck some U.S. officials as bluster masking real concern about the consequences of Russian actions, and there is some evidence that Russians are anxiously pulling tens of billions of dollars out of U.S. accounts. Nearly $105 billion was shifted out of Treasury custodial accounts by foreign central banks or other institutions in the week ending last Wednesday, more than three times that of any other recent week.

Obama held out hope that diplomacy may yet succeed, but he sent Vice President Joe Biden to Eastern Europe to meet with nervous NATO allies like Poland, Lithuania, Latvia and Estonia and reassure them of U.S. resolve.