The Russia-backed separatists reported taking hundreds of soldiers captive as they continued their onslaught on the strategic railroad junction.
Associated Press reporters saw several dozen Ukrainian troops retreating with their weapons from Debaltseve today morning, covered in dirt and looking exhausted.
Some were driving to the nearby town of Artemivsk in trucks while several others, unshaven and visibly upset, were on foot. One soldier spoke of heavy government losses, while another said they had not been able to get food for days because of the rebel shelling.
The army has withdrawn out 80 per cent of its troops from the town and two more columns have yet to leave, Ukrainian President Petro Poroshenko said today.
He denied claims by the rebels that the Ukrainians were surrounded and said the troops were leaving Debaltseve with their weapons and ammunition.
"Debaltseve was under our control, it was never encircled. Our troops and formations have left in an organised and planned manner," he said in televised comments.
Rebel spokesman Eduard Basurin, however, said hundreds of Ukrainian soldiers had surrendered in Debaltseve. Russian state-owned television today showed images of several dozen Ukrainian troops being escorted along a village road by the rebels.
Kiev admitted that some soldiers had been taken prisoner in Debaltseve, but gave no details on how many were seized.
Russian President Vladimir Putin, on a visit to Budapest yesterday, had called on Kiev to admit defeat in the contested town, saying "the only choice" of the Ukrainian troops was to "leave behind weaponry, lay down arms and surrender."
Some retreating troops said today they had not received any reinforcements from the government in Debaltseve and had been walking and retreating for a whole day.
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