Speaking during a question and answer session after delivering a keynote speech at a CEO forum here, Clinton said despite the determination of North Korea to pursue its nuclear weapons programme "I don't believe they want to drop a nuclear bomb on Japan or South Korea. They want to eat and stay warm."
"They don't want to disappear from history like East Germany and they don't want to be disrespected and that's why they want the non-aggression treaty," he said.
"I think we (the US) should offer them a mega deal; help with food, help with energy, help with becoming a self-sustaining economy... in return for total access to all the labs and all the sites and taking the plutonium rods out of (North) Korea altogether and giving them a non-aggression pact.
"I think we should give them that because we're never going to be aggressive against them unless they violate the pact anyway," said Clinton.
The move would be consistent with the wishes of the Chinese, Russians and Japanese who have played a part in defusing the year-long stand-off between the US and North Korea, he added.
The United States and North Korea have been locked in a stand-off since October 2002 over Pyongyang's decision to revive its nuclear weapons programs.
North Korea wants the United States to provide a security guarantee with economic aid to the impoverished communist country, while Washington wants a complete and verifiable dismantling of Pyongyang's nuclear program.
North Korea has recently said it would consider Bush's offer of a written security guarantee in return for scrapping its nuclear ambitions fuelling renewed hopes for a settlement to the year-long crisis.
The hermitic state agreed in principle last week to attend a new round of talks with Japan, Russia, South Korea, the United States and China, following an inconclusive first round of negotiations in Beijing in August.