Ship 'sunk by North Korean torpedo'

South Korea's military believes a torpedo fired from a North Korean submarine sank its navy ship last month, based on intelligence gathered jointly with the United States, a news report said yesterday.

The Yonhap news report appears to be the clearest sign yet that Seoul blames Pyongyang for what would be one of the deadliest incidents between the rivals since the end of the 1950-53 Korean War. It puts more political pressure on President Lee Myung-bak, but analysts do not see it triggering a war.

The military's intelligence arm sent the report of "certain" North Korean involvement to the presidential Blue House soon after the incident, Yonhap quoted a high-ranking military source as saying.

Mr Lee's government has come under criticism for what many see as its overly cautious handling of North Korea. However, it has called for a thorough investigation of the sinking, thought to have killed 46 sailors.

Market players have been calmed by the South's measured response, seeing Seoul as unlikely to take aggressive moves that would escalate into armed conflict and harm the export-driven economies of north Asia, responsible for about one-sixth of the global economy.

South Korea's defence ministry had no comment on the report.

"North Korean submarines are all armed with heavy torpedoes with 200kg (441lb) warheads," the military source was quoted as saying by Yonhap. "It is the military intelligence's assessment that the North attacked with a heavy torpedo."

South Korea plans to soon raise the front half of the 1,200-ton Cheonan, which went down near a disputed sea border with North Korea, and will then issue its verdict on the cause of the explosion that sank the warship. Analysts said there is little South Korea can do even if Pyongyang is found to be the culprit, because a military response is likely to hurt its own quickly-recovering economy and bolster North Korean leader Kim Jong-il's standing at home.