Softening Yanukovich's hardline stance on his arch-rival is seen as crucial if Ukraine is to secure the signing of landmark agreements, including a free trade deal, with the European Union at a November summit.
63-year-old President knows that allowing Tymoshenko to rejoin the political fray would endanger his run at a second term in 2015, given her formidable populist appeal and her organisational skills.
EU heavyweight Germany has been formulating a plan to provide Yanukovich with a way out – quietly pushing a "humanitarian" solution in which Tymoshenko could be received for medical treatment in a Berlin hospital.
“This formula – so the logic goes – would allow Yanukovich to show himself in a good light and might ensure signing of planned agreements on political association and free trade with the European Union at the Vilnius, Lithuania, summit,” Reuters writes.
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According to the source, the Yanukovich camp is insisting as part of any deal that she must pay back more than 1.5 billion hryvnia (about 122.94 million pounds) in estimated damages to the Ukrainian economy caused by her alleged reckless conduct as prime minister.
"The thinking is that that would prevent her financing any campaign against him," Reuters quotes.
Nevertheless, only a change of power in 2015 and the end of the Yanukovich leadership is likely to secure early release for the ambitious Tymoshenko. For despite low ratings due to popular anger over low wages, high prices, poor social services and endemic corruption, Yanukovich looks well placed for re-election in 2015 – as long as she remains out of the running.
“If Tymoshenko gets out somehow, this would be a real threat for Yanukovich. Even if she could not run in the election, she has very strong organizational powers. She is still considered a very dangerous person for the authorities," said Olga Shumylo-Tapiola, visiting scholar of Carnegie Europe in Brussels.
