PYONGYANG - The Democratic People's Republic of Korea (DPRK) has accused the Republic of Korea (ROK) of distorting its true intentions on talks intended to reunite separated families on both sides, the official news agency KCNA reported Saturday.

In a letter to ROK's Unification Ministry from its Committee for the Peaceful Reunification of Korea on Thursday, Pyongyang warned of serious consequences for Seoul's "arrogant demeanor," advising Seoul not to misjudge Pyongyang's "magnanimity and efforts."

The letter said Seoul Wednesday rejected Pyongyang's proposal on working talks for the resumption of tour to the DPRK's scenic Mt. Kumgang, asserting it is desirable to focus on settling the issue of the Kaesong Industrial Zone (KIZ) on a priority basis.

Considering the view of South Korea, the DPRK is willing to put on hold the talks for the resumption of the Mt. Kumgang tour and Red Cross working contact for discussing reunion of separated families in order to concentrate efforts on the KIZ issue, the letter said.

Pyongyang also warned that "how to settle the issue of the KIZ will have bearing on the overall inter-Korean relations."

The KIZ, which houses 123 South Korean companies, has been suspended for nearly three months after Pyongyang banned about 53, 000 of its workers from working in protest of joint South Korean-US annual military drill.

Inter-Korean exchanges were virtually put to a stand amid cross- border and military tensions during the five-year term of the former President Lee, who stepped down early this year.  

The two countries sought to hold their first high-level official talks in six years in June, but the dialogue was canceled due to dispute over the ranks of chief delegates.  

After the second working-level talks between the countries on Wednesday, Pyongyang proposed the talks on Mt. Kumgang tours and family reunion, but decided to "shelve" them on Thursday.

Seoul has voiced regret over the aborted talks.