Crimea on Sunday voted overwhelmingly to secede from Ukraine and seek to join Russia. The West and Ukraine described the referendum which was announced two weeks ago as illegitimate.
The United States and the European Union on Monday announced asset freezes and other sanctions against Russian and Ukrainian officials involved in the Crimean crisis. President Barack Obama warned that more would come if Russia didn't stop interfering in Ukraine.
Former Soviet President Mikhail Gorbachev, however, hailed Crimea's vote to join Russia as a "happy event."
Russian troops have been occupying the region for more than two weeks.
The decree signed by Putin and posted on the official government website Tuesday morning is one of the steps which that formalize the annexation of Crimea. Russia, however, still has room to back off: the treaty to annex Crimea has to be signed by leaders of Russia and Crimea, approved by the Constitutional Court and then be ratified by the parliament.
Putin is set to address both houses of the parliament at 3 p.m. Moscow time (1100 GMT) in a nationally televised speech where he is widely expected to stake Russia's claim on Crimea.
Gorbachev, in remarks carried Tuesday by online newspaper Slon.ru, said Crimea's vote offered residents the freedom of choice and justly reflected their will. The referendum showed that "people really wanted to return to Russia" and was a "happy event," he said.
Gorbachev added that the Crimean referendum set an example for people in Russian-speaking eastern Ukraine, who also should decide their fate.
Crimean Deputy Prime Minister Rustam Temirgaliyev said in an interview with RIA Novosti on Tuesday that the peninsula has already received some financial aid from Russia but stopped short of saying how much.
Many in the ethnic Tatar minority in Crimea were wary of the referendum, fearing that Crimea's break-off from Ukraine would set off violence against them. Temirgaliyev seemed to confirm those fears, saying that the government would ask Tatars to "vacate" some of the lands they "illegally" occupy so authorities can use them for "social needs."
The Russian State Duma, the lower chamber of parliament, on Tuesday unanimously passed a resolution condemning U.S. sanctions targeting Russian officials including members of the chamber. The chamber challenged President Barack Obama to extend the sanctions to all the 353 deputies who voted for Tuesday's resolution, suggesting that being targeted was a badge of honor. Eighty-eight deputies left the house before the vote.
Crimea had been part of Russia since the 18th century until Soviet leader Nikita Khrushchev transferred it to Ukraine in 1954. Both Russians and Crimea's majority ethnic Russian population see annexation as correcting a historic insult.
Ukraine's turmoil, which began in November with a wave of protests against President Viktor Yanukovych and accelerated after he fled to Russia in late February, has become Europe's most severe security crisis in years.
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