SEOUL - COMMUNIST North Korea has completed deployment of medium-range missiles and expanded the size of its military to 1.2 million, South Korea said on Monday in an assessment of the threat from its neighbour.

The intermediate-range missiles can travel up to 3,000 kilometres (1,860 miles), enough to reach the northern tip of Australia, and carry a warhead of up to 650 kilograms (1,430 pounds), the 2008 defence white paper said.

It also said the North is 'presumed' to have secured about 40 kilograms of atom bomb-making plutonium from reprocessing spent nuclear fuel rods from its Yongbyon reactor.

Pyongyang carried out its first atomic test in October 2006, but it is not known whether it could manufacture a nuclear warhead.

The document was published as the North steps up threats against the South and continues apparent preparations to launch its longest-range missile.

It described North Korea as a 'direct and serious threat' to South Korea's security, a stronger term than 'serious threat' used in previous papers.

The white paper did not indicate how many medium-range missiles the North has 'deployed for operational use' since 2007, but added that Pyongyang began to develop them in the late 1990s.

Pyongyang has expanded the warhead capacity of its short-range missiles by 170 to 200 kg across the board over the past few years, it added.

The size of its military had grown to 1.19 million, an increase of 20,000 from 2006, while the number of its lightly-equipped special forces trained to swiftly infiltrate South Korea had increased 50 percent to 180,000.

The paper said North Korea had increased the number of its multiple rocket launchers by 300 over two years to about 5,100 and reinforced its submarines.

Monday's published assessment came amid mounting tensions between the two Koreas, which are still technically at war since the 1950-1953 Korean conflict ended only in an armistice.