TOKYO, Aug. 25 (Xinhuanet) -- Japan will be engaged in building the rocket unit and the United States will be making the warhead in a joint missile defense project, Kyodo News reported Wednesday,quoting sources close to the project.

    The two countries are tied up in developing for Japan a dual-level missile defense system based on current US interception missiles.

    Tokyo aims to start the deployment in fiscal 2006 which begins in April.

    The two countries will conclude a new pact on the project to develop the enhanced Standard Missile-3 interceptor to be deployedon an Aegis vessel after the Japanese endorses the plan at the Security Council around the end of this year, the report said.

    The SM-3 missile is designed to intercept target outside the atmosphere, while the land-based PAC-3 will be used against missiles at lower heights.

    The project involves four key components of the enhanced SM-3 system -- the nosecone, infrared sensor, rocket engine and kineticwarhead.

    The close allies decided to jointly develop the missile defense system after a rocket launched by the Democratic People's Republic of Korea in 1998 flew over Japan. Tokyo and Washington deem it as a ballistic missile.

    Japan eased its ban on arms exports last December and exempted the exports of missile defense-related arms components to the United States to pave the way for the project to move into the development stage. Enditem