* Obama, Hollande, Putin to salute 70th D-Day anniversary
* Stakes high, West hopes Putin greets Ukraine leader
* France's Fabius says no new Russia sanctions for now
(Updates with Fabius, Le Drian comments)
By John Irish
COLLEVILLE-SUR-MER, France, June 6 World leaders
and veterans gathered by the beaches of Normandy under clear
blue skies on Friday to mark the 70th anniversary of World War
Two's D-Day landings, with host France hoping the event will
help bring a thaw in the Ukraine crisis.
Wreaths, parades, parachute-landings and fireworks will be
staged in honour of history's largest amphibious assault on June
6, 1944, when 160,000 U.S., British and Canadian troops waded
ashore to confront Nazi Germany's forces, hastening its defeat.
French President Francois Hollande will be joined at the
commemorations by 20 foreign leaders including U.S. President
Barack Obama, Britain's Queen Elizabeth and Prime Minister David
Cameron, Canada's Stephen Harper, Germany's Angela Merkel and
Vladimir Putin of Russia.
But while the unity of allies and their bloody sacrifices
were the central theme of the D-Day remembrance, the government
leaders will be sounding each other out in private on the most
serious security crisis in Europe since the Cold War: Ukraine.
Russia's annexation of Crimea in March and the current
standoff in eastern Ukraine between government forces and
pro-Russian separatists have plunged Moscow's relations with the
United States and European Union to a post-Cold War low.
French diplomats say Hollande hopes to get Putin to at least
shake the hand of Ukrainian president-elect Petro Poroshenko on
the sidelines of the ceremonies, in what could represent a first
step in defusing tensions.
The French president discussed Ukraine at separate dinners
on Thursday with both Obama and Putin in Paris, but officials
reported no major breakthrough.
Asked if the Normandy gathering could bring a thaw, French
Foreign Minister Laurent Fabius, who attended the talks, told
RTL radio: "We'll see how things go today and tomorrow. It is in
nobody's interest to have a major conflict in Ukraine."
He said there was no question for the time being of European
countries imposing a new round of sanctions against Russian
Putin, who has said he is open to meeting both Obama and
Poroshenko while in France, has yet to recognise the legitimacy
of the Ukrainian leader who is set to be sworn in on Saturday,
although Russia is sending its ambassador to his inauguration.
A Group of Seven (G7) summit of industrialised nations in
Brussels on Thursday, from which Putin was excluded, urged
Russia to work with Kiev's new authorities to restore stability
in eastern Ukraine or face possible tougher sanctions.
Hollande underlined the diplomatic opportunity presented by
the D-Day ceremonies, saying: "It is also a major international
event which should serve the interests of peace."
Obama told reporters on Thursday that Russia would face new
sanctions if it fails to recognise Ukraine's new government and
does not work to calm violence from militants in the east of
Russia's fellow former Soviet neighbour.
"There is a path in which Russia has the capacity to engage
directly with President Poroshenko now. He should take it,"
Obama said. "If he does not - if he continues a strategy of
undermining the sovereignty of Ukraine, then we have no choice
but to respond."
Behind the facade of G7 unity, differences emerged over a
1.2 billion euro ($1.63 billion) French contract to sell two
Mistral helicopter carriers to Russia. Obama said Paris should
have pressed "the pause button" on the deal.
"These contracts have for the most part been paid up and
they stand for many jobs," Fabius said on Friday. "The French
tradition, which is the same as the United States', is to honour
However Defence Minister Jean-Yves Le Drian told France
Inter radio that a decision would be taken in the light of the
international situation later this year when the first ship is
due to be delivered.
Washington says the deal sends the wrong message to Russia
at a time of sanctions imposed by Western states on Moscow over
the conflict in Ukraine.
Putin's relations with Ukraine as well as with the European
Union and the United States have been tense since pro-Western
protesters ousted a Moscow-friendly Ukrainian president from
power in February and Russia then seized Crimea.
($1 = 0.7345 Euros)
(Additional reporting by Nick Vinocur Writing by Alexandria
Sage; Editing by Mark Heinrich and Paul Taylor)