MOSCOW — Under threat of crippling trade sanctions by Russia, Ukraine announced Thursday that it had suspended its plans to sign far-reaching political and trade agreements with the European Union and said it would instead pursue new partnerships with a competing trade bloc of former Soviet states.

The decision largely scuttles what had been the European Union’s most important foreign policy initiative: an ambitious effort to draw in former Soviet republics and lock them on a trajectory of changes based on Western political and economic sensibilities. The project, called the Eastern Partnership program, began more than four years ago.

Ukraine’s decision not to sign the agreements at a major conference next week in Vilnius, Lithuania, is a victory for President Vladimir V. Putin of Russia. He had maneuvered forcefully to derail the plans, which he regarded as a serious threat, an economic version of the West’s effort to build military power by expanding NATO eastward. In September, similar pressure by Russia forced Armenia to abandon its talks with the Europeans.

European leaders reacted with fury and regret, directed at Kiev and Moscow. “This is a disappointment not just for the E.U. but, we believe, for the people of Ukraine,” Catherine Ashton, the European Union’s foreign policy chief, said in a statement. Calling the pact that Ukraine was walking away from “the most ambitious agreement the E.U. has ever offered to a partner country,” Ms. Ashton suggested the country would suffer financially.