AUSTRALIA SAYS IT IS PREPARED TO TAKE ACTION AGAINST OS TERRORISTS.

CANBERRA, Dec 2 Asia Pulse - Australian Prime Minister John Howard increased regional tensions, warning he would take pre-emptive action against terrorists overseas to stop an attack on Australia.

Indonesia immediately warned Australia to stay within international law.

Opposition foreign Affairs spokesman Kevin Rudd said Mr Howard's suggestions of a pre-emptive strike were outside the law.

South-East Asian nations, already angry over the cost to their economies of Australia's travel warnings, are also likely to react strongly to Mr Howard's call for a change to international law to deal with terrorists overseas.

National leaders had no alternative but to use available means to stop an attack against their countries, whether that was from another state or from terrorism, Mr Howard said.

Speaking on the Nine Network, Mr Howard said the most likely threat to a nation's security was non-state terrorism, and international law could no longer cope with the changed circumstances confronting the world.

When asked whether he would be prepared to act if he knew terrorists in a neighbouring country were planning to attack Australia, Mr Howard said: "Oh yes, I think any Australian prime minister would".