A joint South-North Korean industrial complex was operating normally Thursday, officials said, despite Pyongyang severing a military hotline used to monitor movement in and out of the zone.

Around 160 South Koreans passed through the border control Thursday morning, on their way to the South-funded Kaesong industrial complex which lies 10 kilometres (six miles) inside North Korea.

"Movement to Kaesong is going ahead normally," an official at the South's Unification Ministry told AFP.

There had been concerns that operations at the complex would be affected by the North's announcement Wednesday that it was snapping its last military hotline with the South.

The line was used daily to provide the North with the names of those seeking entry to Kaesong, guaranteeing their safety as they crossed one of the world's most heavily militarised borders.

Kaesong was established in 2004 as a symbol of cross-border cooperation. North Korea has always been wary of allowing crises in inter-Korean relations to affect the zone -- a crucial hard-currency earner for the communist state.

The Unification Ministry official said a civilian telephone line had been used to relay the names of visitors to the border guards via the Kaesong management committee.

"It just means the entry and exit procedures become a little bit more cumbersome, because the list has to go through one more hand," the official said.

Nevertheless, the Unification Ministry formally requested the North to reconnect the military hotline, saying its suspension could impact "stable operation" of Kaesong, where more than 50,000 North Koreans work at small, labour-intensive South Korean plants.

The North said it was cutting the military hotline to protest recent South Korean-US military exercises, which are held every year and are regularly condemned by Pyongyang as rehearsals for invasion.

Their staging this year fuelled tensions created by the North's long-range rocket launch in December and its nuclear test last month.

Both events triggered UN sanctions that infuriated Pyongyang, which has spent the past month issuing increasingly bellicose statements about unleashing an "all-out war".

A North Korean military official, informing the South that the hotline was being cut, said it was no longer needed given that "war may break out any moment".

The United States denounced the move as "provocative" and the South Korean and US defence ministers spoke by telephone Thursday to underline their joint commitment to deterring any North Korean aggression.

US Defense Secretary Chuck Hagel stressed that all US military capability would be extended to the South, "including the nuclear umbrella, conventional strike means and missile defence", the South's defence ministry said in a statement.

The North has severed the military hotline before, most recently in March 2009, again in protest at the annual South Korean-US military exercises. In that case, the line was reconnected less than two weeks later.

Several weeks ago North Korea severed a Red Cross hotline that had been used for government-to-government communications.

The current crisis on the Korean peninsula has provided an early and stern challenge to South Korea's new president, Park Geun-Hye, who was only sworn in a month ago.

Park had campaigned on a promise of greater engagement with Pyongyang, in contrast to the hardline stance of her predecessor Lee Myung-Bak, who oversaw a total freeze in inter-Korean contact.

Since taking office, Park has played both hawk and dove, warning Pyongyang that it must abandon its nuclear weapons programme to survive, while keeping the door open to talks and pushing her campaign's trust-building proposals.

Park's pointman on North Korea, new Unification Minister Ryoo Kihl-Jae, said he would seek talks with Pyongyang this year to resume reunions for families separated by the 1950-53 Korean War.

The first reunions were held in 2000, but have been on hold since 2010 when the sinking of a South Korean naval vessel and the North's shelling of a border island sent relations into a tailspin.