South Korea has suspended a trilateral logistics project with North Korea and Russia as part of its measures to punish the North for its nuclear and missile tests, sources said Thursday.

The project linked the three countries by rail and sea, with shipments of coal and bottled water arriving in the South through North Korea's port city of Rajin and Russia's border city of Khasan.

As the project is a source of income for the North, South Korea will halt its development to stop the money from being channeled into the North's development of weapons of mass destruction, the sources said.

Seoul announced Wednesday that it will close the inter-Korean industrial complex in North Korea's border city of Kaesong. The U.N., U.S. and Japan are also in the process of imposing additional sanctions on Pyongyang over its fourth nuclear test in January and long-range rocket launch earlier this week.

All discussions about a formal contract on the project will be put on hold, the sources added.

Along with the Kaesong Industrial Complex, the logistics project was one of the few exceptions to Seoul's punitive measures against Pyongyang following the deadly sinking of a South Korean warship in March 2010. (Yonhap)