* EU leaders meet in Brussels to discuss sanctions on Russia, help for Ukraine
* PM Yatseniuk warns Russia wants to damage May 25 election
* Says further Moscow incursions into Ukraine possible, NATO entry unlikely
By Justyna Pawlak
BRUSSELS, March 20 (Reuters) - Russian President Vladimir Putin wants to destabilise Ukraine's presidential election in May and has been preparing for possible military action in eastern Ukraine, Prime Minister Arseny Yatseniuk said.
In an interview with Reuters, Yatseniuk, 39, said Putin wants to extend his hold on Ukraine outside the Crimea peninsula, which he took over earlier this month, into other areas where the majority of the country's Russian speakers live.
"We have clear proof and evidence (that) Russian agencies hired a number of so-called protesters - or actually gangsters - with the task to trigger another cycle of violence in southern and eastern Ukraine," he said.
"They moved these militants from their bases in Transdnistria," he said, referring to the separatist, mainly Russian-speaking region on Ukraine's border that broke away from Moldova in 1992 and sees Moscow as its patron.
Such moves would be part of a plan by Putin, he said, to spark "provocations ... and send his military to defend the Russian-speaking minority there".
Putin has dismissed such suggestions.
Yatseniuk came to office after the removal of Moscow-backed President Viktor Yanukovich following months of protests triggered by his refusal to sign a trade deal with the European Union last November.
He said that to further undermine Ukraine, Putin will try to challenge the validity of the country's May 25 presidential election.
Western governments hope that vote will help cement political change in Ukraine, but Yatseniuk said Putin might try to trigger violent clashes to cast doubt on the result.
"Russia wants to cancel the presidential election, divide Ukraine, and the ultimate goal of Russia is to eliminate Ukrainian independence," he said.
Beyond Ukraine, Yatseniuk said, Putin was eyeing more influence in other former Soviet republics.
"All of them," said the exhausted-looking Yatseniuk during a flight to Brussels to participate in a European Union summit on Thursday and Friday.
At the meeting, EU leaders will discuss ways to increase pressure on Russia over Ukraine and how to support Kiev's battered economy.
DAMAGED ECONOMY
Yatseniuk, who has said the country's new pro-Western leadership would not seek membership of NATO, said he did not believe the 28-member military alliance would accept Kiev anyway.
Kiev had pursued a policy of closer ties with U.S.-led NATO before Yanukovich took power in 2010 and scrapped the idea of Ukraine's eventual membership.
"Even if we ask, they will not accept it. I do remember 2008," Yatseniuk said.
In 2008 NATO rebuffed U.S. demands to put Ukraine on an immediate path to membership, with western European governments saying they did not want to antagonise Russia.
Yatseniuk said that decision at a NATO summit in Bucharest had in part cleared the way for Moscow's takeover of Crimea.
"We missed our chance in 2008, and the Russians tried to absorb Crimea. This is the price," he said.
Addressing the badly damaged Ukrainian economy, Yatseniuk said it could contract by as much as 3 percent this year, compared with a government target of no growth.
He also said Kiev had no intention of cutting Crimea's electricity or water supplies, roughly 90 percent of which comes from the rest of Ukraine, but wanted Moscow to pay for any deliveries.
"We will not shut down ... supplies, but the Russians have to pay," he said.
Kiev would also pursue legal recourse if Moscow moved to nationalise or take over any Crimean companies.
"I want to assure Russia that we will sue them in any court on the globe if they steal our property. This conflict is for years." (Reporting by Justyna Pawlak; Editing by Will Waterman)
Our Standards: The Thomson Reuters Trust Principles.
