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North Korea praises Kim Jong Il

North Korea could be planning another nuclear test for next year, a South Korean think tank has warned, as Pyongyang celebrated the anniversary of leader Kim Jong Il's elevation to military chief, calling him "an invincible and iron-willed commander".

The 19th anniversary of Kim being named supreme commander of the Korean People's Army came a day after South Korea held massive drills near the world's most heavily armed border - part of a series of exercises that have angered the North and prompted it to threaten to launch a "sacred" nuclear war if attacked.

Heated rhetoric has increasingly been heard from both sides, as tensions have soared between the rivals in the month since a North Korean artillery barrage on a South Korean island killed four people.

On Friday, the North lauded Kim Jong Il and his "songun", or "military-first," policy. "Kim Jong Il is the benevolent father and a mainstay for the faith of the army and people," Pyongyang's main Rodong Sinmun newspaper said in an editorial.

Kim attended a banquet on Friday along with his youngest son and heir apparent, Kim Jong Un, as senior North Korean officials enthusiastically welcomed the senior Kim and extended "the highest glory and the warmest thanks" to him, KCNA reported Saturday.

With relations at a low, North Korea has been struggling to restart negotiations aimed at ending its nuclear weapons program - talks that have provided it much-needed aid in exchange for pledges to disarm. The programme - and two widely condemned nuclear tests- has drawn a raft of sanctions from the international community, making Pyongyang increasingly reliant on aid to feed its people.

But far from backing away from the nuclear issue, North Korea is expected to continue to work on its atomic weapons programs in 2011, a South Korean Foreign Ministry-affiliated think tank has said.

"The possibility is always open for a third nuclear test to improve" its atomic capabilities, the Institute of Foreign Affairs and National Security said in a report.

According to a report released by the International Crisis Group, the Koreas' disputed maritime boundary and the volatility of North Korea's internal politics have "created a serious risk that any further provocation might turn into a wider conflict".

While the North would lose in an all-out war against the South and the United States, "Seoul is constrained in retaliating forcefully because it has so much to lose" economically and politically, the report said.

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