Japan plans to launch a bilateral relations panel to discuss how to expand exchanges with South Korea as the two countries mark the 20th anniversary of a declaration to promote future-oriented ties, government sources said.

Based on the envisaged panel's input, the government apparently hopes to step up diplomacy and improve ties frayed by wartime history, especially the issue of the "comfort women," Japan's euphemism for the tens of thousands of females who were forced to work in its military brothels before and during the war.

The roughly 10-member panel will include people from both academic and business circles who are well-versed in Japan-South Korea relations, the sources said Saturday, adding the lineup would be finalized by the end of the month.