NOVO-OGARYOVO, July 15. /TASS/. Ukraine should use financial aid from the International Monetary Fund (IMF) to repay its $3 billion debt to Russia, President Vladimir Putin said at a government meeting on Wednesday.

"About $5 billion [Ukraine is expected to receive as financial assistance] until the end of the year," Finance Minister Anton Siluanov told the government meeting.

"Of this amount, $3 billion should be given to us," Putin said.

The Russian Finance Ministry’s press office said the IMF’s aid program for Ukraine envisaged the disbursement of three tranches worth a total of $5.1 billion until the end of this year.

The first $1.66 billion tranche was not disbursed, although the IMF’s financial aid program stipulated its transfer to Ukraine until June 15.

Possibly, the volume of the IMF’s aid to Ukraine will be adjusted to equal slightly over $3 billion. Nevertheless, Russia’s expects Kiev to repay its debt, the Finance Ministry’s press office said.

Russian Deputy Finance Minister Sergey Storchak said earlier Russia expected Ukraine to pay $75 million on its Eurobonds on June 22 and would regard any failure to make the payment as "a default event." However, Ukraine made this payment on schedule.

The Ukrainian financial authorities have stated on many occasions they consider Kiev’s debt to Russia as commercial liabilities and insist on debt restructuring.

However, Russia considers this debt as Kiev’s state liabilities and demands its full repayment in December 2015.

Ukraine currently has to restructure debts worth about $15 billion, of which $3 billion is its debt to Russia.

IMF says Ukraine’s $3 billion bonds sold to Russia should be treated as Kiev’s official debt

The International Monetary Fund has formed a preliminary view that Ukraine’s $3 billion bonds sold to Russia should be treated as official rather than private debt, news agency Bloomberg reported late in June, citing a source familiar with the matter.

Treating the $3 billion bonds as official debt would exclude them from the bond restructuring Ukraine is negotiating with a creditor group led by Franklin Templeton, placing a greater burden on private bondholders, Bloomberg said.

At the same time, this status of the bonds still has to be approved by the IMF’s executive board.

Russia has repeatedly said the bonds it purchased from Ukraine should be treated as official aid and repaid in full when they mature in December while Ukraine argues the debt was structured as Eurobonds under UK law and is subject to the same treatment as private creditors, Bloomberg reported.

Ukraine’s external debt hit $72.9 billion as of late 2014 while its internal debt stood at $29 billion and its gold and foreign currency reserves were less than $10 billion.

Russia made a decision in late 2013 to invest up to $15 billion in Ukraine’s sovereign Eurobonds. Soon afterwards, Russia bought Ukraine’s first Eurobond tranche worth $3 billion with a two-year maturity and a coupon rate of 5% per annum and coupon payments every six months.

Russia subsequently decided against investing the other $12 billion in Ukraine’s bonds.