The flags of the European Union and Greece hang outside the headquarters of the Greek central bank in Athens. The country needs to secure an aid package worth 130 billion euros ($171 billion) along with about 100 billion euros from private bondholders to stave off default. Angelos Tzortzinis / Bloomberg

European officials ratcheted up the pressure on the Greek government to deliver spending cuts in exchange for a second bailout as they insisted that default is not an option.

Finance ministers canceled Wednesday's meeting in Brussels and will hold a teleconference instead to prod Greece to do more to clinch an aid package worth 130 billion euros ($171 billion) along with about 100 billion euros of debt relief from private bondholders. Greece needs the money to make a 14.5-billion-euro bond payment on March 20.

The decision to cancel the meeting is "very worrying", and "reflects a growing concern" among some eurozone countries that "Greece will not abide by the conditions of the second bailout package", said Nicola Mai, an economist at JPMorgan Chase Bank in London. "It appears that some euro-area countries are willing to let Greece default."

As a result, the once-taboo notion of a departure or expulsion from the eurozone has crept into the mainstream political debate.

"If they don't do this, they exclude themselves from the eurozone and the impact on the other countries now would be less important than maybe a year ago," Luxembourg Finance Minister Luc Frieden said at the Atlantic Council in Washington this week.

According to AFP, Greek Finance Minister Evangelos Venizelos said on Wednesday that several EU countries no longer want Greece in the currency zone after the eurogroup delayed a decision on a key Greek bailout.

"We have to tell the Greek people the truth," Venizelos said. "There are several (eurozone countries) who no longer want us. And we must convince them" that Greece can remain in the eurozone, he said, adding that "the country is on a knife's edge".

Two years after pledging to pull Greece back from the brink, European leaders are torn between pouring more aid into the struggling economy or risking an unprecedented national bankruptcy that might force the country out of the eurozone and prompt renewed market tumult.

"The decision was the result of an evaluation by the head of the eurogroup, Jean-Claude Juncker, that there weren't sufficient elements of consensus to be sure that a meeting would be successful," Italian Prime Minister Mario Monti said on Tuesday.

After Juncker canceled the gathering, citing a lack of political assurances from Greek leaders to stick to austerity pledges, a government official in Athens said the leaders of Greece's two biggest political parties, New Democracy's Antonis Samaras and Pasok's George Papandreou, will provide on Wednesday the written commitments demanded.

Greek Prime Minister Lucas Papademos's Cabinet agreed to make up a 325-million-euro gap in unaccounted for austerity measures from cuts to defense, public investment and local authorities, two government officials said on Tuesday. Cuts will also be made to the health budget, one said. The measures still need to be approved by European governments and the International Monetary Fund, the officials said.

Meanwhile, evidence has mounted that the guardians of the euro have made progress ring-fencing Greece's woes. Italy on Tuesday sold 6 billion euros in bonds at lowered borrowing costs as investors shrugged off a downgrade of its credit rating by Moody's Investors Service.

German Finance Minister Wolfgang Schaeuble said on Monday that if efforts to prop up Greece come to naught, "we're better prepared than two years ago".

Finance Minister Jan Kees de Jager of the Netherlands, one of four AAA-rated states left in the eurozone, pushed back against suggestions from Athens that the aid bill will be 15 billion euros higher than planned.

"We agreed upon 130 billion euros," De Jager told Dutch RTL television on Tuesday. "If now it seems more is needed, we should explore other ways."