Barack Obama has pledged a billion-dollar military programme of reinforcements in Europe to assuage east European alarm at the Kremlin's expansionist ambitions following the Ukraine crisis.

Arriving in Warsaw to mark 25 years since the first semi-free elections in the communist bloc produced eastern Europe's first non-communist prime minister, the US president pronounced the security of Poland and the three Baltic states, all Nato and EU members, sacrosanct.

Kicking off a week of intensive diplomacy in Europe focused on western responses to Vladimir Putin and Ukraine, Obama announced that he was seeking congressional backing for a billion-dollar fund to rotate more US troops in and out of Poland, to strengthen air patrols over the Baltic, and to beef up naval operations in the Black Sea off the Russian and Ukrainian coasts.

On Russia and Ukraine's borders, Poland, Lithuania, Latvia, and Estonia – two of them with sizeable ethnic Russian minorities – are alarmed over their vulnerability to Russian pressure and dismayed that Nato has resorted only to token gestures in calming their nerves.

Radek Sikorski, the Polish foreign minister who hopes to become the EU's next foreign policy chief, has dismissed US moves to increase aerial sorties over the Baltic and to rotate more troops in and out of Poland as "virtual deployments" and complained bitterly that US bases in Europe, all in western Europe, are in all the wrong places.

Obama sought to assuage such concerns. "Our commitment to Poland's security as well as the security of our allies in central and eastern Europe is a cornerstone of our own security and is sacrosanct," he said.

A White House statement said: "We are reviewing our force presence in Europe in the light of the new security challenges on the continent."

Obama's billion-dollar "European Reassurance Initiative", conditional on congressional approval, was aimed at calming east European angst about Russia. But it was clear that there was no prospect of the US or Nato setting up permanent bases in Poland or elsewhere in eastern Europe, a no-go area since the end of the cold war.

Obama is to deliver a setpiece speech in Warsaw on Wednesday on European security in the wake of Putin's land grab in Ukraine and on the 25th anniversary of Poland's semi-free election in 1989 that was a triumph for the anti-communist Solidarity movement and triggered a chain reaction across the region that ended Moscow-imposed communism.

Obama then travels to Brussels for a two-day G-7 summit, which will also be dominated by Ukraine, after Russia was expelled from the G-8 in March and a planned Putin-hosted summit in Sochi was shifted to Belgium.

By Friday, Obama and western leaders will be in Paris and on the Normandy beaches for the D-day 70th anniversary, with Putin in attendance – meeting western leaders for the first time since the Ukraine crisis erupted in February.

The German chancellor, Angela Merkel, is to hold talks with Putin in France. It is not clear whether Putin and Obama will meet directly.

Senior European officials said that while economic sanctions against Russia remained "in preparation", the emphasis had shifted to diplomacy since last week's presidential elections in Ukraine. The focus of the talks over the next few days would be to encourage direct negotiations between Moscow and Kiev.

"The priority is to try to get a diplomatic, political solution, using the opportunity supplied by the Ukrainian election," said a senior EU official. "There is now this window which will be used."

In Brussels, Nato defence ministers also grappled with the implications of the Ukraine crisis ahead of a Nato summit in Cardiff in September. North European countries agreed to increase their contributions to a small Nato regional headquarters on Poland's Baltic coast.

Russian officials warned that Moscow would respond to any greater US or Nato military presence on the territory of what used to be the Warsaw pact, while the pro-Kremlin media detected new western plans to contain, encircle, and encroach on Russia.

"Are Poland and the other central and eastern European countries happy to be 'the battlefield' in the event of a conflict with Russia? Isn't Nato membership a threat, rather than a boon, to the security of Poland and other new Nato members in the centre and east of Europe?" said Voice of Russia. "Recent events seem to confirm an 'unholy alliance' between anti-Russian extremist nationalism and the mainstream politicians in central and eastern Europe."