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South Korea says it will retaliate with missile strikes against the North if faced with "further provocations", after an exchange of fire in which two South Korean marines were killed.
After an emergency meeting, President Lee Myung-bak said "indiscriminate attacks" would "never be tolerated".
He was responding to one of the worst clashes since the Korean War ended.
The North shelled an inhabited island close to a disputed maritime border, and the south returned fire.
The South Korean military had been carrying out an exercise in the area, and the North accused the South of opening the hostilities - something Seoul denies.
BBC News
North Korea has launched 50 shells which landed on an inhabited island - South Korea fires 80 rounds back - however I have no information on a target for South Korean shelling yet. The latest decision to mention missile strikes raises the temperature as North korea also adds in response that "the North will strike back if South Korea "dares to invade our sea territory by 0.001mm".
Regionally, Japan and Russia have condemned the events of today while China remains quiet. Japan has ordered preparation in event of "any eventuality."
Note: this thread has been created to discuss events in Korea today. Please can anyone contributing discuss Korea only.