Baroness Thatcher met Falkland veterans and unveiled a commemorative arch today to mark the 25th anniversary of the conflict.

The former Conservative Prime Minister led the country during the 1982 crisis when Argentina invaded the islands.

A total 255 British and around 649 Argentinians lost their lives in the 74-day battle.

Hundreds of residents lined the streets for the Iron Lady's guest-of-honour appearance in Fareham, Hampshire this morning.

One hundred and seventy Royal Naval personnel from aboard HMS Collingwood marched through the town to greet Lady Thatcher.

The 81-year-old former leader, wearing a fuchsia dress and coat with a pearl necklace, looked frail as she inspected the troops and 25 Falklands' veterans.

She then watched a drumhead service and held on to her black hat in the wind as she sang hymns during the service.

Baroness Thatcher listened keenly as Falkland veteran, former chief petty officer Derek Kimber, told the crowd: ''The British nation has always been slow to anger and respond but in the course of 1982 we had no other choice but to either bow down to a bullying regime or stand and fight.'' Mr Kimber, 62, from Gosport, in Hampshire, who served on board HMS Coventry, added: ''Thankfully we had a government and a leader who after diplomacy had failed had the guts to stand up to a bully.'' Lady Thatcher was then joined by the Lord Lieutenant of Hampshire, Mary Fagan, to unveil the Falklands Arch.

Fareham Borough Council commissioned the £25,000 piece of ironwork to commemorate all those who lost their lives in the war and so that future generations will remember the sacrifice they made.