Kwang-tae Kim

The North proposed that its delegation composed of up to 30 investigators stay in the South for three to five days or even longer to conduct field investigations and that the U.S. guarantee all logistical support, the North’s official Korean Central News Agency later reported.

“If the ‘results of investigation’ announced by the joint investigation team were objective and scientific as claimed by the U.S. forces side, there would be no reason for it to refuse to receive the inspection group,” the North said, according to KCNA.

A team of international investigators concluded in May that a North Korean submarine fired the torpedo that sank the warship in what Seoul called the worst military attack on South Korea since the 1950-53 Korean War.

The U.N. Security Council approved a presidential statement earlier this month condemning the incident, but did not directly blame Pyongyang.

The U.N. Command, however, blames North Korea for the incident and considers it a violation of the cease-fire, a command official said Friday, speaking on condition of anonymity because the results of the command’s own investigation have not been released.

The meeting took place as a North Korean official threatened a “physical response” if the U.S. and South Korea carry out joint military exercises that U.S. Defense Secretary Robert Gates said would be held to send a “clear message” to North Korea to stop its “aggressive behavior.”

North Korean spokesman Ri Tong Il told reporters at an Association of Southeast Asian Nations meeting in Hanoi, Vietnam, that the military exercises would be “another expression of hostile policy against” North Korea. “There will be physical response against the threat imposed by the United States militarily,” he warned.

The military drills are to run Sunday through Wednesday with about 8,000 U.S. and South Korean troops, about 20 ships and submarines and 200 aircraft, including the USS George Washington aircraft carrier and the U.S. Air Force’s F-22 stealth fighter.

Pyongyang routinely accuses the U.S. and South Korea of staging the military drills as a rehearsal for an attack on North Korea. Washington and Seoul say the exercises are purely defensive and that they have no intention of invading the North.

The North’s officers also called on the U.S. to call off the planned military exercises, KCNA said, saying the U.S. move is “a dangerous one of driving the situation on the Korean peninsula to a war phase.”

The U.S. stations 28,500 soldiers in South Korea to protect the ally against aggression.

Even as tensions were rising, South Korea’s President Lee Myung-bak said Friday that Seoul was willing to expand humanitarian assistance for the impoverished rival, the Yonhap News Agency reported.

“President Lee said such a humanitarian aid should continue and stressed more active assistance is necessary to help North Korea,” Lee’s spokeswoman Kim Hee-jung quoted him as saying.

The about-face by the conservative president comes as Pyongyang faces fewer sources of much-needed aid, with the U.N. Security Council tightening sanctions because of its nuclear defiance and the U.S. announcing new sanctions earlier this week.

South Korea returned fire and dispatched fighter jets in response, and said there could be considerable North Korean casualties as troops unleashed intense retaliatory fire. The supreme military command in Pyongyang threatened more strikes if the South crossed their maritime border by “even 0.001 millimeter,” according to the North’s official Korean Central News Agency.

Government officials in Seoul called the bombardments “inhumane atrocities” that violated the 1953 armistice halting the Korean War. The two sides technically remain at war because a peace treaty was never signed.

The exchange was a sharp escalation of the skirmishes that flare up along the disputed border from time to time, and come amid high tensions over North Korea’s claim that it has a new uranium enrichment facility and just six weeks after North Korean leader Kim Jong Il unveiled youngest son Kim Jong Un as his heir apparent.

Columns of thick black smoke could be seen rising from homes on the island in footage aired by YTN cable television. Screams and shouts filled the air as shells rained down on the island for about an hour.

“I thought I would die,” Lee Chun-ok, 54, told The Associated Press after being evacuated to the port city of Incheon, west of Seoul. “I was really, really terrified, and I’m still terrified.”

She said she was watching TV when the shelling began, and a wall and door in her home suddenly collapsed.

The United States, which has more than 28,000 troops stationed in South Korea, condemned the attack. in Washington, White House Press Secretary Robert Gibbs called on North Korea to “halt its belligerent action,” and said the U.S. is “firmly committed” to South Korea’s defense, and to the “maintenance of regional peace and stability.”

China, the North’s economic and political benefactor, which also maintains close commercial ties to the South, appealed to both sides to remain calm and “to do more to contribute to peace and stability on the peninsula, Foreign Ministry spokesman Hong Lei said.

Yeonpyeong, famous for its crabbing industry and home to about 1,200 civilians as well as South Korean military installations, is west of the Korean mainland within sight of North Korean shores. There are about 30 other small islands nearby.

North Korea fired dozens of rounds of artillery in three separate barrages that began in the mid-afternoon, while South Korea returned fire with about 80 rounds, South Korea’s Joint Chiefs of Staff said. The entire exchange lasted about an hour.

Two South Korean marines were killed and 16 injured, the Joint Chiefs of Staff said. Island residents escaped to some 20 shelters on the island and sporadic shelling ended after about an hour, according to the military.

The skirmish occurred a day after the South Korean military began holding drills in the area, exercises that North Korea’s military demanded an end to early Tuesday, the JCS said.

South Korean marines participating in the drill had been shooting artillery during those drills, but toward southern waters, away from North Korea, a military official said, speaking on condition of anonymity due to military rules.

President Lee Myung-bak ordered officials to “respond sternly” but to refrain from allowing the situation to escalate, according to a presidential official. He asked not to be identified, citing the issue’s sensitivity.

Lee was convening an emergency security meeting, the official said.

The Koreans have remained in a technical state of war for decades because their three-year conflict ended in a truce, not a peace treaty, in 1953.

However, North Korea does not recognize the western maritime border drawn unilaterally by the United Nations at the close of the conflict, and the Koreas have fought three bloody skirmishes there in recent years.

In March, a South Korean warship went down in the waters while on a routine patrolling mission. Forty-six sailors were killed in what South Korea calls the worst military attack on the country since the Korean War.

Seoul blamed a North Korean torpedo, but Pyongyang denied responsibility.

However, the shooting — the first at the border since 2007 — came just hours after North Korea threatened to retaliate for South Korea’s refusal last week to hold military talks with its wartime rival.

South Korean soldiers immediately returned fire, but sustained no injuries, according to the Joint Chiefs official, who asked not to be identified because he was not authorized to speak to the media. There was no word from the North on either the incident or injuries.

The exchange lasted just a few minutes but highlighted the security challenges South Korea faces as it prepares to host next month’s Group of 20 summit in Seoul, just 30 miles (50 kilometers) from the border.

The firing underscores the unusual — almost surreal — world South Korea inhabits: Though a major global economy and a political leader in Asia with one of the highest standards of living in the world, the South is still technically at war with the North because their conflict ended in a truce, not a peace treaty. Tens of thousands of troops stand guard on both sides of the border dividing the Koreas.

Communist North Korea has a track record of provocations against South Korea at times of internal change, external pressure or when world attention is focused on Seoul.

“The North wants to show the world that military tension grips the Korean peninsula,” said Kim Yong-hyun, an expert on North Korean affairs at Seoul’s Dongguk University.

In 1987, a year before Seoul hosted the Summer Olympics, North Korean agents planted a bomb on a South Korean plane, killing all 115 people on board. In 2002, when South Korea was jointly hosting soccer’s World Cup along with Japan, a North Korean naval boat sank a South Korean patrol vessel near their disputed western sea border.

Analyst Lee Sang-hyun of the Sejong Institute, a private security think tank outside Seoul, agreed that the North was probably hoping to humiliate South Korean President Lee Myung-bak on the eve of the G-20. But he remained cautious about whether the firing was an isolated incident or could signal further provocations against the South.

Tensions have been particularly high since the March sinking of a South Korean warship in the waters off the peninsula’s west coast. Forty-six sailors died in the sinking, which an international panel blamed on a North Korean torpedo; Pyongyang, however, denies involvement.

But more recently, the North has made a series of conciliatory gestures, and relations seemed to be beginning to thaw.

North Korea recently proposed talks to discuss anti-North Korean leafletting by South Korean activists and other propaganda activities, Pyongyang’s official Korean Central News Agency reported Friday.

When Seoul rejected the proposal, the army threatened a “merciless physical retaliation” Friday for the snub, KCNA said. It promised South Korea would realize “what catastrophic impact their rejection of dialogue will have on the North-South relations.”

In Seoul, a Defense Ministry official said the military talks proposed last week by the North did not take place because the two Koreas remain at odds over the sinking of the Cheonan. He spoke on condition of anonymity, citing internal policy.

Pyongyang had warned during military talks in late September that it could fire artillery at sites in the South where civilian activists set off huge helium balloons filled with leaflets condemning North Korean leader Kim Jong Il, pushing them across the border.

The North views the leaflets — which activists hope will persuade North Koreans to rise up against Kim — as part of psychological warfare aimed at toppling its regime. Seoul says it cannot ban its citizens from expressing their opinion.

Despite the spike in tensions Friday, the reunions of hundreds of families separated by the Korean War will go ahead Saturday in the North Korean resort of Diamond Mountain as scheduled, South Korean Unification Ministry spokesman Chun Hae-sung said.

Shooting incidents at the border are infrequent; the last border shooting was in 2007, when South Korea said North Korean soldiers opened fire and the South shot back, according to the JSC.

However, North Korean troops fired some 30 artillery rounds near the western maritime border in January, prompting the South to fire 100 warning shots in response.

At 80-minute talks Wednesday suggested by South Korea and convened in the North Korean border town of Kaesong, the North expressed its regret, Unification Ministry spokesman Lee Jong-joo said. The North also said it had to discharge the waters to avoid a bigger catastrophe.

“It was regrettable that unintended human casualties occurred,” the North Korean chief delegate told South Korean officials, Lee said.

The North also offered condolences to the bereaved South Korean families, Lee said.

The sides held a 15-minute session in the afternoon to wrap up Wednesday’s talks.

Chief South Korean delegate Kim Nam-shik told reporters later in the day that the North again assured it would notify Seoul of similar releases and that the two sides agreed to meet again at an early date to discuss setting up a flood warning system.

Presidential spokesman Park Sun-kyoo welcomed the North’s comments, saying they sent a “fairly positive signal” that it wants to improve relations with the South.

The discussions Wednesday took place amid reports that the North Korea may be preparing to test-fire more missiles following a barrage of missile launches off its east coast on Monday — the regime’s first since early July.

The latest launches appeared to be meant to improve the accuracy of North Korea’s missiles, a senior South Korean presidential official told reporters. He asked not to be identified because of the issue’s sensitivity.

South Korea has detected indications that North Korea is also preparing to fire short-range missiles off its west coast, Dong-a Ilbo newspaper reported, citing an unidentified military official. The newspaper said the North has announced a no-sail zone in areas off the country’s east and west coasts for Oct. 10-20 — an apparent signal the country could carry out more missile tests.

The Yonhap news agency carried a similar report.

South Korea’s Defense Ministry declined to comment on the intelligence issue.

North Korea has recently reached out to the U.S. and South Korea following months of tension over its nuclear and missile tests earlier this year. Leader Kim Jong Il told visiting Chinese Premier Wen Jiabao last week that his government might return to stalled six-nation negotiations on its nuclear program depending on the outcome of direct talks it seeks with the U.S.

In Beijing, U.S. Assistant Secretary of State Kurt Campbell said Wednesday that Washington will not meet directly with North Korea until Pyongyang commits to rejoining six-nation disarmament talks and abides by commitments to dismantle its nuclear programs.

“The Chinese indicated that they think they heard from North Korea that they are prepared to accept that framework. But again, we will have to test that, explore that and see if that is indeed the case,” he said. Campbell was in Beijing for talks likely aimed at President Barack Obama’s visit next month.

Former President George W. Bush expressed confidence Wednesday that the North Korean nuclear issue can be resolved through diplomacy, but he cautioned Kim is likely to continue to prove a formidable negotiator who “will no doubt test the system, no doubt try to find weaknesses.”

Bush told the World Knowledge Forum, an annual conference sponsored by a South Korean business newspaper, that the best way to bring peace to the Korean peninsula is through the six-nation talks.

The disarmament talks involving the two Koreas, the U.S., China, Russia and Japan were last held in Beijing in December.

The 1950-53 Korean War ended in a cease-fire, not a peace treaty, which means the two Koreas are still technically at war.

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Associated Press Writer Christopher Bodeen in Beijing contributed to this report.