Kiev, rebels exchange POWs; trains, buses to Crimea suspended

KIEV (Reuters) - Ukraine's government and pro-Russian separatists on Friday began an exchange of hundreds of prisoners of war while Kiev said it would suspend all train and bus service to Crimea, effectively creating a transportation blockade to and from the region.

The agreement to swap 125 Ukrainian servicemen for 225 rebels followed peace talks between envoys of Ukraine, Russia, the separatists and European security watchdog Organization for Security and Cooperation in Europe (OSCE) on Wednesday.

Ukrainian transportation chiefs said the reason for suspending train and bus service was the need to protect passengers due to a "deteriorating" security situation on the Black Sea peninsula, annexed by Russia in March.

Crimea is controlled by Russia, but its only land link is with Ukraine and it has remained dependent on the Ukrainian mainland for most of its supplies, including much of its electricity and water. Ukraine already has banned sea and air traffic with Crimea, which is still serviced by Russian airlines.

Other road transportation including passenger cars and trucks will still be allowed to travel into and out of Crimea.

State rail company Ukrzaliznytsia said cargo trains would be suspended beginning on Friday, while passenger routes would gradually cease running over the weekend and on Monday.

PRISONER EXCHANGE

Markiyan Lubkyvsky, an aide to the head of Ukraine's SBU security service, confirmed that the prisoner exchange process, part of a 12-point peace plan, had begun. It was not clear how long it would take.

It is not known exactly how many prisoners are held by the two sides, but Ukraine's military said this month about 600 Ukrainians were in rebel hands.

Russia's Interfax news agency said rebels reported that the exchange had already been completed in their eastern stronghold of Donetsk, resulting in a swap of 222 separatists for 150 Ukrainian prisoners.

In addition, Visa Inc and MasterCard Inc, the world's two largest credit and debit card companies, said they could no longer support bank cards being used in Crimea following U.S. sanctions imposed earlier this month.

The United States last Friday prohibited U.S.-registered companies from investing in Crimea or providing services to companies operating there, among measures imposed over Russia's annexation of the peninsula from Ukraine.

Russia's takeover of Crimea, an annexation Kiev does not recognise, pushed relations between Moscow and the West to their lowest point since the Cold War.

Russian President Vladimir Putin has signed a new military doctrine, naming NATO expansion among key external risks, the Kremlin said on Friday, days after Ukraine made fresh steps to join the Atlantic military alliance.

The uprising by separatists began a month after Russia annexed the Black Sea peninsula of Crimea from Ukraine in March, following the popular overthrow of Ukraine's Moscow-backed president. The conflict has killed more than 4,700 people.

Kiev's pro-Western government has said Russia orchestrated the rebellion in Ukraine's east, a charge denied by Moscow.

Violence arising from Kiev's conflict with pro-Russian separatists has been confined almost exclusively to eastern regions of Ukraine and has not affected Crimea. But the Ukrainian government has repeatedly warned of a build-up of Russian forces on the peninsula.

(Reporting by Pavel Polityuk and Alessandra Prentice; Additional reporting by Polina Devitt, Alexander Winning and Maria Tsvetkova in Moscow and Barbara Lewis in Brussels; Writing by Will Dunham; Editing by Toni Reinhold)

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