North Korea torpedoed South's navy ship

So what Happens now ?

Nothing , After they raise the other half of the Ship and prove that it was a torpedo , they will Probably verbally slap North Korea .


(Reuters) - South Korea's military believes a torpedo fired from a North Korean submarine sank its navy ship last month, based on intelligence gathered jointly with the United States, a news report said on Thursday.

World | South Korea | North Korea

The Yonhap news report appears to be the clearest sign yet that Seoul blames Pyongyang for what would be one of the deadliest incidents between the rivals since the end of the 1950-53 Korean War. It puts more political pressure on President Lee Myung-bak, but analysts do not see it triggering a war.

The military's intelligence arm sent the report of "certain" North Korean involvement to the presidential Blue House soon after the incident, Yonhap quoted a high-ranking military source as saying.

Lee's government has come under criticism for what many see as its overly cautious handling of possible links to North Korea. It has called for a thorough investigation of the sinking, thought to have killed 46 sailors.

Market players have been calmed by the South's measured response, seeing Seoul as unlikely to take aggressive moves that would escalate into armed conflict and harm the export-driven economies of North Asia, responsible for about one-sixth of the global economy.

South Korea's defense ministry had no comment on the report.

"North Korean submarines are all armed with heavy torpedoes with 200 kg (441 lb) warheads," the military source was quoted as saying by Yonhap. "It is the military intelligence's assessment that the North attacked with a heavy torpedo.

"The military intelligence has made the report to the Blue House and to the Defense Ministry immediately after the sinking of the Cheonan that it is clearly the work of North Korea's military," the source was quoted as saying.

Korean navies exchange fire in disputed waters

Wow , The Norks tucked their tails and ran when tested by the South Korean navy !
This is more of North Korea testing their limits of who and how much they can Push ,with a damaged ship , maybe they found out that they are not so tough that No one will fight back with them !

....
Seoul, South Korea (CNN) -- North and South Korean naval forces exchanged fire on Tuesday in disputed waters, a South Korean defense official said.

The two Koreas clashed off their west coast, the first such incident in seven years, each blaming the other for the incident.

South Korean President Lee Myung-bak convened an emergency security meeting and urged the military to to ensure that the naval clash did not escalate into something greater, Yonhap reported.

South Korea issued three verbal warnings to ship from the Communist north once the vessel had crossed a demarcation line late Tuesday morning, said Rear Adm. Lee Ki Sik of the Joint Chiefs of Staff. The South Koreans then fired a warning shot but when the North Korean vessel continued southward, the South Koreans opened fire.

The North Koreans returned fire before heading back, their ship damaged in the exchange, Lee said. There were no South Korean casualties, Lee said.