March 8, 2004-North Korea's government said it will make the pullout of U.S. forces from South Korea a condition of a nuclear agreement, unless the U.S. stops insisting that an accord require the North to dismantle its weapons program first.

North Korea also will demand a ``complete, verifiable, irreversible security assurance'' from the U.S. in exchange for American insistence the nuclear program be dismantled on those terms, the official Korea Central News Agency said in a release.

The U.S. aims to ``round off preparations for a second Korean War by rummaging through (North Korea) under the pretext of `inspection,''' the agency said. ``If the U.S. gives up its demand for `scrapping nuclear program first' and makes a switchover in its Korea policy, dramatic progress will be made in settling the nuclear issue.''

South Korea, the U.S., China, Japan and Russia are seeking to persuade North Korea to abandon its nuclear program in return for security guarantees and energy aid. The six nations held talks in Beijing last month and will meet again by June 30 in an effort to settle the dispute.

As diplomacy goes on, the Pentagon warned in a new intelligence assessment that North Korea's nuclear ambitions were linked to the survival of Kim Jong Il's regime, and the U.S. insisted its defense of the Korean Peninsula would remain strong.

North Korea today again blamed the U.S. for slow progress at the talks, saying the Bush administration must change its policy toward the regime and stop insisting on discussing the country's enriched uranium program, which it called ``fictitious.''

Pentagon, DIA Views

Any changes in U.S. forces in South Korea would involve consultations with the government in Seoul, the Pentagon said in a statement today. ``Any changes in the U.S. presence will ensure that the forces are more capable and credible,'' it said.

``Future of the Alliance'' talks, entering their second year, ``have not included any discussions about troop reductions nor have they included any discussions about the changes to the combined command relationship,'' the Pentagon said.

North Korea's ``open pursuit of nuclear weapons and delivery systems remains a serious challenge,'' Defense Intelligence Agency Director Vice Admiral Lowell Jacoby said in a new, unclassified assessment. The North ``considers its nuclear weapons program critical to regime survival,'' Jacoby wrote.

``North Korean media reports suggest Kim Jong Il believes the speed and success'' of U.S. operations against Iraq ``underscores the ineffectiveness of the North's conventional forces and the value of nuclear weapons,'' Jacoby said.

Still, ``North Korea's People's Army remains capable of inflicting hundreds and thousands of casualties and severe damage on the South,'' he said.

Pakistani Help

Pakistani nuclear scientist Abdul Qadeer Khan has acknowledged helping North Korea set up a program to make enriched uranium, used as fissile material in atomic bombs. North Korea, which has only acknowledged seeking to make plutonium weapons, has called Khan's statement false.

The U.S. continues to demand ``the complete, verifiable and irreversible dismantlement of North Korea's nuclear programs, by which we mean plutonium and uranium enrichment-based programs,'' Assistant U.S. Secretary of State James Kelly said last week.

The U.S., which has about 37,000 soldiers stationed in South Korea to help guard the South's border with the North, is insisting North Korea dismantle its nuclear program before talks on normalizing relations. North Korea wants ``simultaneous action'' by the two countries.

`Assured'

In a Washington meeting Thursday with Secretary of State Colin Powell, South Korean Foreign Minister Ban Ki-Moon said his country was ``very much assured by President (George W.) Bush and also Secretary Powell's reassurance that the relocation of U.S. forces in Korea will be carried out in a manner not to weaken the combined defense capabilities in the Korean Peninsula.''

U.S. soldiers are withdrawing from the tense demilitarized zone separating the two Koreas, an area vulnerable to North Korean artillery, and moving their headquarters out of the South Korean capital, Seoul.

Contact Joshua Fellman in Hong Kong at jfellman@bloomberg.com or Seyoon Kim skim7@bloomberg.net. The editor Peter Torday can be reached at ptorday@bloomberg.net.

http://quote.bloomberg.com/apps/news?pid=10000087&sid=aCCoLOfsEQdc&refer=top_world_news