Tensions between Thailand and Burma are rising amid new reports of gunfire across their border. The presence of Burmese drug lords and ethnic rebels in the area makes it difficult to calm the situation.

Tensions between Thailand and Burma appear far from settled, despite efforts by Thai Defense Minister Chavalit Yongchaiyudh to arrange cross-border talks.

Thursday, there were reports of Thai army troops exchanging fire with unidentified gunmen across the border.

Thai Prime Minister Thaksin Shinawatra is saying troops must not overreact and further escalate tensions along the border.

The defense minister hopes to meet with top Burmese officials soon. However, Bangkok Thursday said no schedule has been set for a meeting.

Tensions began rising this month after several incidents of cross-border shelling during battles between Burma's army and members of Burma's Shan minority group. Burma's military government accuses Thailand of supporting Shan rebels, as well as another rebel group, the Karen National Union, or KNU. Thailand denies supporting the rebels.

"They [Burma] believe that the Thai forces have been intruding into their territory and helping the Shan and KNU," says Chaiyachoke Chulasiriwong, a political scientist at Thailand's Chulalongkorn University. The problem along the border between Burma and Thailand is very serious. I think it is very dangerous." The Thai military wants to halt a flood of illegal methamphetamine and heroin, coming into Thailand from Burma. Thai officials and international observers say Burma's Wa ethnic group is behind the trade. Burma, however, says the drugs come from the Shan.

Thailand's prime minister and defense minister say they place a high priority on having smooth relations with Rangoon. Last week, to cool tensions, Bangkok ordered an early halt to military exercises on the northern border. The exercises had angered Rangoon.

Burma, however, has not softened its stance. Western diplomats in Rangoon say Burma has restricted Thai imports, closed border check points and banned some Thai advertising in Burmese magazines.

Some analysts say Thailand worries about Burma's rising military strength. According to Jane's Defence Weekly, Burma had about 180,000 troops in the late 1980's, but the number now is above 400,000.

Diplomats and analysts say Burma has purchased about $1 billion worth of weaponry, including fighter jets and tanks in the past few years.

Analysts fear that unless tensions ease soon, a cross-border battle could be triggered by shelling by one of the ethnic minority groups. The Wa guerrilla army alone has 20,000 troops and is closely allied with Burma's military.