The Israeli Defense Ministry confirmed on Wednesday the abduction of two Israeli soldiers by Lebanese Hizbollah militia.

Israeli Defense Minister Amir Peretz said in a statement issued by the ministry that the two soldiers had been captured by Hizbollah during clashes in the Israel-Lebanon border.

Peretz also held the Lebanese government for full responsibility for the Wednesday morning attack along the northern border by Hizbollah militia.

He also said Lebanon was "directly responsible for the fate of the soldiers", demanding the Lebanese authorities act immediately to ensure their safety and their return to Israel, according to the statement.

Meanwhile, Israeli Prime Minister Ehud Olmert vowed that those involved in the border attack would pay "a heavy price." "There are elements in the north and in the south who are threatening our stability and are trying to test our steadfastness. They will fail and pay a heavy price for their actions," he said. Olmert is expected to convene a security cabinet meeting later in the day.

Israel's Channel 10 TV reported that Israel Defense Forces Chief of Staff Dan Halutz had headed into the war room at the Defense Ministry complex.

The TV also reported that Hizbollah had demanded Israel release prisoners held in Israeli jails in exchange for the two abducted soldiers.

Earlier in the day, Hizbollah militants fired two missiles from southern Lebanon onto northern Israel, wounding four Israeli civilians.

Israeli forces responded by air strikes and artillery shelling against Hizbollah positions.

The two sides also traded fire over the border.