DATE=02/08/01

TYPE=CORRESPONDENT REPORT

TITLE=KOREAS TALKS - L

NUMBER=2-272306

BYLINE=HYUN-SUNG KHANG

DATELINE=SEOUL

CONTENT=

VOICED AT:

INTRO: Military officials from North and South Korea have reached agreement on guidelines for reconnecting land links severed for half a century. Hyun-Sung Khang reports from the South Korean capital, Seoul that the agreement includes creation of the first-ever military hotline between the two countries.

TEXT: North and South Korean military officials agreed on 41 points to guide cooperation during construction of a railway and highway across their heavily armed border.

The deal reached at talks in the border village of Panmunjom Thursday - aims to prevent possible military clashes during mine-clearing and other operations in the demilitarized zone.

In another sign of easing tensions, Korean military officials also agreed to the creation of a military hotline.

Seoul officials say they hope the rail link can be reconnected by the fall, as scheduled. If the plan goes ahead, the rail line will be the first direct transport link between the two Koreas since the end of the Civil War in 1953. It will run through Seoul and Pyongyang, the capitals of South and North Korea, and then continue on to the border town of Sinuiju, lying between North Korea and China.

Meanwhile in separate talks taking place in Pyongyang, economic officials from the two Koreas have so far failed to agree on ways to ease the North's chronic energy shortages. Pool reports from Pyongyang say Seoul officials proposed a joint survey of the energy requirements of the whole Korean peninsula and offered to visit one hydraulic and two thermal North Korean power plants during their stay in the North.

Last year, North Korea requested 500-thousand kilowatts of electricity. Seoul estimates the North is capable of generating more than seven million kilowatts of electricity, but can only produce two million because of outdated facilities and fuel shortages.

The two sets of talks are the latest in a series of contacts signaling a marked warming of ties between North and South. Relations between them have improved dramatically since the inter-Korea summit held by the leaders of the two countries last June. The Korean peninsula was separated into the Communist North and the pro-western South following the Second World War.

NEB/HK/HSK/JO/PFH