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Yahoo! My Yahoo! Mail More Yahoo! Services Account Options New User? Sign Up Sign In Help Yahoo! Search web search Home Singapore Asia Pacific World Business Entertainment Sports Technology Weekend Edition Australia China India Indonesia Japan Malaysia Philippines Thailand Vietnam South Korea holds drill, North lobs only insults Reuters - 41 minutes ago Send IM Story Print By Jack Kim and Sylvia Westall SEOUL - North Korea criticised major land and sea military exercises staged by the South on Thursday, but stopped short of threatening a retaliatory strike as tension remained high on the divided peninsula. In a show of military might, South Korea held a major land drill in the Pocheon region, between Seoul and the heavily armed demilitarised zone south of the maritime border with North Korea. In a rare visit to the front line, South Korean President Lee Myung-bak visited a separate military unit near the border to inspect defensive readiness against Pyongyang. The drill, involving a larger scale of firepower and personnel than usual for an exercise at the army training ground, is an indication that Lee wants to show the public Seoul can stand up to the North. A large contingent of mechanised units operating tanks, three dozen self-propelled artillery, fighter jets and multiple rocket launchers, took part in the live-fire drill which started around 5:42 a.m. British time just miles from the border with the North. The tanks charged across the valley and artillery shots echoed as helicopters hovered overhead, firing rockets at targets. Fighter jets dropped explosives into the valley, creating plumes of smoke. Lee has replaced his top defence officials with more hawkish military men, a response to criticism of a perceived weak response to hostile acts from the North, including a submarine attack in March and the shelling of an island last month. " is trying to hide the provocative nature towards the North of the war exercises," Pyongyang's official KCNA news agency said in a comment, calling the drills "madcap" and "offensive." The South Korean Army is making no secret that the drill is aimed at displaying its firepower to its neighbour. "We are facing a crisis because of North Korea, so I came to see this air and ground operation. I want to feel and see the level of South Korea's armed forces," said Kim Tae-dong, a 70-year-old internet businessman, in Pocheon. "Another North Korean provocation will happen. We should prepare our military perfectly for that." Seoul's financial markets closed flat, with investors shrugging off the tensions. Pyongyang's threatening remarks have in the past failed to have a lasting effect. DISPUTED WATERS The North's reaction was relatively calm in comparison with its threats of a retaliatory strike made as recently as last week, before Monday's live-firing drill on Yeonpyeong, which lies in disputed waters off the west coast of the peninsula. Its official Rodong Sinmun newspaper accused the United States of conspiring with the South and Japan to bring war to the Korean peninsula. "The Korean peninsula has turned sharply unstable on the brink of war due to scheming by the U.S. to militarily stifle the North," the commentary said. Analysts say the North is unlikely, in the near-term at least, to launch a further attack against the South like last month's shelling of Yeonpyeong or the sinking in March of the Cheonan warship. The South accuses North Korea of sinking the vessel, though the North denies involvement. For now, the North is likely to wait and see if its latest actions, including an offer to readmit international nuclear inspectors, yield results, such as a return to international talks on Pyongyang's nuclear programme. China, the impoverished North's only major ally, has urged dialogue to resolve the crisis and has been reluctant lay to blame, frustrating Washington and its allies which want Beijing to do more to rein in Pyongyang. Barack Obama is expected to press this point when Chinese President Hu Jintao visits the United States on January 19. Despite the North's muted response this week, South Korea should not be complacent because Pyongyang will probably strike again when the conditions are right, Andrei Lankov at Kookmin University in Seoul said. "The North Korean leaders did not duck the fight this time because they were afraid," he wrote in Financial Times earlier this week referring to the Monday's drills. "Rather, they did what a cold-minded tactician should do: they avoided an engagement under unfavourable conditions chosen by the opponent, in order to strike the opponent at the time and place of their own choice, suddenly and forcefully." 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