Rebel 'Prime Minister' of Donetsk Says Quits Post as Fighter Jet Shot Down over East Ukraine

The prime minister of Ukraine's self-proclaimed Donetsk People's Republic announced Thursday that he was resigning his position.

Russian citizen Alexander Borodai said he was stepping down in favor of a local field commander, Alexander Zakharchenko, after finishing his work as a "start-upper".

Borodai denied he was fleeing the unrecognized republic as a brutal government offensive closed in around the million-strong city.

"I think that the worst is over. Yes, we are in a very difficult military situation but every day this situation changes for the better and our armed forces grow stronger," he told journalists at a press conference in the rebel headquarters.

The unshaven Muscovite said he wanted to hand the post on to someone originally from the region but pledged to continue work as a deputy prime minister.

Borodai, a fervent Russian nationalist and former journalist, emerged at the head of the rebels in May as one of a handful of key Russian leaders directing the insurgency.

The appearance of Russian citizens at the head of the rebel movement fueled claims that Moscow was backing and arming the insurgency.

Borodai admitted that he had helped steer through the Kremlin's annexation of Ukraine's Crimea peninsula in March but always remained a junior partner to the rebel's top military leader Igor Strelkov, a self-confessed former Russian intelligence officer whose real name is Girkin.

Borodai's replacement Zakharchenko, who is reportedly from Donetsk, served as a field commander under Strelkov and headed an organisation of amateur fight enthusiasts who supported Ukraine's deposed president Viktor Yanukovych.

Meanwhile on ground, a Ukrainian fighter jet tumbled to earth in a fireball Thursday after it was blasted out of the air while flying low over rebel-held territory in the east of the country.

An Agence France Presse crew saw the Sukhoi warplane explode in mid-air and the parachute of at least one pilot opening up in the clear blue sky.

Explosions and flashes erupted from the wreckage as it continued to burn on the ground, sending up clouds of acrid smoke.

Two armed rebels ran around the blackened field close to the flaming debris as the sound of shooting rang out nearby.

Another plane could be heard flying high overhead and the insurgents shouted at the AFP team to leave the scene.

A local resident told AFP that he had seen at least two parachutes appear after the aircraft was hit.

"It flew past us and there was an explosion. Two pilots ejected out," said Danil, 17.

A Ukrainian military spokesman confirmed that rebels had shot down a jet some 40 kilometers (25 miles) to the northeast of the rebel stronghold Donetsk.

"The pilot managed to steer the craft away from a residential area," spokesman Vladislav Seleznyov told AFP.

A search-and-rescue mission was currently underway for the pilot, he said.

The location was also some 40 kilometers west of the site where Malaysia Airlines flight MH17 was shot down at an altitude of some 10,000 meters on July 17 killing all 298 people on board.

The Ukrainian military has lost a string of aircraft during almost four months of fierce fighting against pro-Russian rebels in east Ukraine that has claimed over 1,300 lives.

Two Ukrainian Sukhoi jets were shot down on July 23, with Kiev alleging the missiles that hit them had come from Russian territory.

On Thursday the Ukrainian army announced it was scrapping a ceasefire around the MH17 crash site after international investigators decided to suspend their probe there due to ongoing fighting.

Sustained shelling pounded the center of the rebel stronghold of Donetsk for the first time in the conflict, with at least 11 civilians killed by clashes around the region.