(Adds details, Putin call, EU statement, IMF)
By Andrei Makhovsky
MINSK, June 19 (Reuters) - President Alexander Lukashenko said on Friday Belarus had foiled a foreign plot to destabilise the country ahead of a presidential election in August, a day after the arrest of his main political rival sparked protests.
Lukashenko has ruled the ex-Soviet country with an iron fist for 26 years but faces his biggest challenge in years as frustration over his handling of the coronavirus pandemic has combined with grievances over the economy and human rights.
Relations with traditional ally Russia have been strained in recent months as Moscow reduced subsidies that have propped up Lukashenko. But his crackdown on opponents will likely hobble his efforts to mend fences with the West.
The European Union called for the immediate release of Viktor Babariko, widely seen as the most potent challenger to Lukashenko, who was arrested on Thursday.
Lukashenko said there had been a large-scale plan to foment a revolution akin to the street protests in Ukraine in 2014.
He said political forces from "both from the West and from the East" had concentrated their interests in Belarus, and that "certain forces" had intensified their efforts. He did not give details or say which foreign country was involved.
"That was the goal. The masks were torn not only from certain puppets we had here, but also from puppeteers who sit outside Belarus," he said.
Babariko was head of the local unit of Russia's Gazprombank before running for president. A top security official said Babariko was controlled by Russian "puppeteers" and Lukashenko said the bank's money was being used to finance Babariko's campaign. Babariko's campaign team called the allegations against him "an absurdity".
Kremlin spokesman Dmitry Peskov said Russia had no plans to intervene. "The Kremlin does not have a candidate at the Belarusian elections. The candidate at the elections is the Belarusian people," he said.
Separately President Vladimir Putin and Lukashenko spoke by phone but the Kremlin readout did not mention Babariko's arrest.
Lukashenko's allegations of a foreign plot came after authorities opened a criminal case against Belgazprombank, the local unit of Gazprombank.
On Friday, Lukashenko said the International Monetary Fund was demanding Belarus impose lockdown measures as a condition for loans, but Minsk would not cave in to the demand. (Reporting by Andrei Makhovsky in Minsk Andrey Kuzmin and Tom Balmforth in Moscow Writing by Matthias Williams Editing by Frances Kerry and Giles Elgood)
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