The 2017 budget allocated for South Korea's unification ministry dropped 20.5 percent from a year earlier, as inter-Korean ties remain frayed amid North Korea's nuclear standoff, government officials aid Monday.

A total of 1.208 trillion won ($1.02 billion) has been set aside for next year's budget for the ministry handling inter-Korean affairs, including 958.8 billion won for the state inter-Korean cooperation fund, they said.

The country's parliament on Saturday passed a 400.5 trillion won government spending plan for next year.

The ministry said that a fall in the budget reflects the strained ties between South and North Korea, as Pyongyang conducted two nuclear tests this year alone and launched a long-range rocket early this year.

The size of the inter-Korean cooperation fund earmarked for next year will represent a 23.6 percent fall from 2016, it said.

South Korea set up the fund in 1991 in order to facilitate inter-Korean exchanges and economic cooperation. Since 2008, the yearly size of the fund has remained at near 1 trillion won.

Meanwhile, the government newly allocated 13.5 billion won to implementing a new law aimed at improving North Korea's human rights situation.

Under the law, which went into effect in September, Seoul set up an agency tasked with compiling North Korea's human rights abuses.

The law also calls for the establishment of a foundation to support the relevant civic groups' activities to improve Pyongyang's rights situation.

But the formation of its board has yet to be finalized, as rival political parties have not yet recommended any candidates. (Yonhap)