Russia has made what may be a move towards taking part in talks over the Ukraine crisis, but is standing firm in its insistence that Crimea has a right to break away from Kiev's rule.

Britain said on Monday, Russian President Vladimir Putin had promised to meet his foreign minister to discuss creating an "international contact group", according to a report from the Agence France-Presse news agency.

The small diplomatic step forward came against the backdrop of Putin's recognition on Sunday of Crimea's self-declared leaders as the breakaway peninsula's "legitimate" authorities.

The promise of talks comes on the back of statements made by German Chancellor Angela Merkel, who insisted a contact group be formed to deal with questions of territorial integrity, minorities and the preparations for elections.

Merkel, speaking after an extraordinary meeting in Brussels last week, said that if a group was not formed it would lead to travel and financial restrictions, and finally to "severe and far-reaching consequences for relations between the European Union and the Russian Federation".

A Moscow-backed referendum on whether Crimea should join Russia, due to be held on March 16, is illegal and violates Ukraine's constitution, Merkel said in statements published on the German government's website.

Article 73 of the Ukrainian constitution states that "alterations to the territory of Ukraine shall be resolved exclusively by the All-Ukrainian referendum", meaning a vote held only in Crimea would be unconstitutional, and, therefore, void.

Many people in Crimea, however, view the current Ukrainian government as illegitimate, arguing that the ousting of former President Viktor Yanukovich was a coup.

Putin on Sunday defended breakaway moves by pro-Russian leaders in Crimea, where Russian forces tightened their grip on the Ukrainian Black Sea peninsula by seizing another border post and a military airfield.

As thousands staged rival rallies in Crimea on Sunday, street violence flared in Sevastopol, when pro-Russian activists and Cossacks attacked a group of Ukrainians.

Chinese President Xi Jinping, meanwhile, called for all parties to remain calm and urged a political solution to the crisis, during telephone calls with US President Barack Obama and Merkel, the Reuters news agency reported.

"The situation in Ukraine is extremely complex, and what is most urgent is for all sides to remain calm and exercise restraint to avoid an escalation in tensions," China's Foreign Ministry said on Monday, citing Xi as telling Obama.

'Legitimate interests'

Putin said last week that Russia had the right to invade Ukraine to protect Russian citizens, and his parliament has voted to change the law to make it easier to annex territory inhabited by Russian speakers.

Speaking by telephone to Merkel and British Prime Minister David Cameron, Putin said steps taken by authorities in Crimea were "based on international law and aimed at guaranteeing the legitimate interests of the peninsula's population", the Kremlin said.

Ukrainian Prime Minister Arseny Yatseniuk will hold talks with Obama in Washington on Wednesday, on how to find a peaceful resolution to the crisis, the White House said.

One of Obama's top national security officials said the US would not recognise the annexation of Crimea by Russia if residents vote to leave Ukraine in a referendum next week.

"We won't recognise it, nor will most of the world," deputy national security adviser Tony Blinken said.