Capability: having the means of defense (soldiers, technology, weapons...)
Capacity: having enough resources to use capability (manpower, food, ammo, money, energy)
Brazil for example is great at the second, having plenty of resources, but sucks at first, having no national tank manufacturer, poor naval tech and so on...
North Korea is sort the opposite: have tons od artillery, missiles, nuclear tech, but most likely nowhere near the resources needed for extended war, they can only hope people fear the damage they can output in their initial strike is deterrent enough.
