LATEST: Prime Minister John Key says the deaths of two New Zealand soldiers in Afghanistan is a great tragedy for this country.

The pair, who were working in the Provincial Reconstruction Team, died after a battle in Bamiyan province, in which six other Kiwis soldiers were wounded.

Two Afghan members of the special police were also killed, and 11 injured in the firefight in the north-east of the region.

Speaking to media at the Defence Force base at Whenuapai, Key said it was with great sadness he learnt of the deaths.

"It's a day of great tragedy where we lose two of our soldiers and obviously they join the other five before them," he said.

"For New Zealand, a small country, losing seven of our men is an enormous price to pay."

Key confirmed that the loss of life and injury toll was the worst for New Zealand since it went into Afghanistan - but said that was only in terms of phsycial numbers.

"Each and every one of the fatalities that we've suffered brings with it it's own story, it's own family and a huge sense of grief."

Key said the tragedy would not affect the withdrawl date from Afgahnistan.

"I don't think the terrible loss we've suffered overnight means we should leave earlier. We should continue on track," he said.

WHAT WENT WRONG?

Chief of Defence Force Lieutenant General Rhys Jones said the troops had been called in to help local forces after an attempted arrest of an insurgent near Do Abe went wrong.

The local troops were ambushed early in the morning while travelling and were killed on the side of the road.

As the Afghans tried to retrieve their dead, the New Zealanders were called in to help push back the insurgents and secure the area.

Coalition air support was called to help evacuated the injured Afghans.

It took almost two hours for the New Zealand troops to travel the 10-15km from their bases at Romero and Do Abe to the scene of the attack. The road was treacherous and steep, Jones said.

Upon arrival, the Kiwis laid down suppressing fire on a compound of buildings where the insurgents remained to the local forces could clear.

Once that was done, the New Zealanders moved to secure the area and came under fire from a separate group of insurgents.

Anti-tank fire was put against the armoured vehicles and the group fired on the Kiwis with machine guns and rifles.

"Whether those Afghan forces were waiting there for us or whether they were there to cover and protect the withdrawl for their own forces out there we don't know," Jones said.

Two Kiwis were killed - one from a blast to an armoured vehicle, the second from ground fire. One of the men - it's not known which - died instantly. The second died from likely organ damage in the helicopter on the way to hospital.

Six other New Zealanders were wounded, again by gun shot or shrapnel, with three now in a serious but stable condition in medical facilities. The other three sustained moderate injuries.

The period where the soliders were killed and injured only took about 2-3 minutes, Jones said.

Following the battle, 17 insurgents were spotted moving away, carrying their dead and wounded in to a neighbouring area that isn't under coalition control.

Once was captured by Kiwi troops, and will now be handed over to Afghan authorities.

The defence force would do a battle debrief to find what went wrong.

"I remain confident the training of our guys remains top quality and that the response to the incident was very good," Jones said.

DANGEROUS TASK

The deaths bring the total number of New Zealanders who have died in Afghanistan to seven.

The contingent now in Afghanistan was drawn from the 2nd First Battalion, based at Burnham army base, near Christchurch.

They left in early April and are the 20th rotation of troops to serve as the reconstruction team in Bamiyan.

"It is a reminder of the dangers our soldiers face in Afghanistan," Key said.

Defence Minister Jonathan Coleman also offered his condolences to the families of the two dead soldiers.

"We've lost two brave young men. this is going to be felt very heavily among the NZDF."

"Today is a day that certainly weighs heavily upon us."

Labour leader David Shearer said his heart and prayers were with the families of the deceased and those injured during the incident.

However, New Zealanders should be proud of the work our troops were doing in Afghanistan.

Bamiyan was one of the best provinces thanks to the work New Zealand had done with defence troops, local authorities and development specialists, he said.

"I think we should keep that in mind because I think New Zealand can be proud of what we've been able to achieve."

Shearer, who worked in Afghanistan during his former career as a humanitarian worker, said the province was "as good as it gets".

"Unfortunately, Afghanistan generally is a very violent place and there is always the threat of danger and tragically that's what's happened today.

"Anywhere in Afghanistan there are these underlying tensions, there are groups that want to destabilise and undermine the efforts that we have made."

The area of Bamiyan where the incident occurred was "more troublesome" than other parts of the province.

But going into such areas was part of the job of New Zealand soldiers working there, he said.

The deceased soldiers were there serving New Zealand and doing a great job, Shearer said.

Governor General Sir Jerry Mateparae, a former Defence Force chief, said the two paid the ultimate sacrifice.

They and the injured were part of a team that had worked tirelessly and consistently to bring about peace and stability in the Bamiyan province, he said.

"Their presence in Afghanistan exemplified their dedication to New Zealand and the New Zealand Defence Force's mission in that country."

Serving in war-torn countries such as Afghanistan carried significant risk, Sir Jerry said.

He expressed his, and wife Janine's, condolences to the families and mates of the deceased soldiers.

The Defence Force is withholding the names of the dead soldiers for 24 hours saying it wants to give to next of kin time to grieve.

The two dead soldiers were both male.

NZ military deaths in Afghanistan
August 5: Two provincial reconstruction team soldiers killed in firefight in north eastern Bamiyan province.
April 2012: Corporal Douglas Hughes died at Romero base in Bamiyan.
September 2011: SAS Lance Corporal Leon Smith killed during operation in Wardak province.
August 2011: SAS Corporal Doug Grant, 41, killed during Taleban attack in Kabul.
February 2011: Private Kirifi Mila killed in Humvee accident, Bamiyan.
August 2010:  Lieutenant Tim O'Donnell killed when his convoy was ambushed in Bamiyan.

- © Fairfax NZ News