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By Luke Baker and Mike Peacock BRUSSELS (Reuters) - The world's leading industrialized nations threatened on Wednesday to impose harder-hitting sanctions on Russia if it does not help restore stability to eastern Ukraine, where pro-Russian militias continue to operate at will. While Ukraine was able to hold a largely peaceful presidential election last month, the situation in the east near the Russian border remains volatile, with armed groups attacking Ukrainian government forces and occupying state buildings. "We stand ready to intensify targeted sanctions and to consider significant additional restrictive measures to impose further costs on Russia should events so require," the G7 said in a statement after evening talks in Brussels. German Chancellor Angela Merkel said Western powers would check "again and again" to verify that Russia was doing what it could to stabilize the situation, which erupted in March after Russia seized Crimea from Ukraine and annexed it.More...