New Zealand plans to ban commercial fishing near its coast and set up marine reserves to protect the rare Hector's dolphins, a government minister said.

The Hector's dolphin is estimated to number around 7,400 from 29,000 in the late 1970s. However, one of its sub-species, the Maui dolphin, is said to be the rarest in the world and facing extinction with as few as 111 animals left.

Fishing is blamed for up to three-quarters of the known deaths of Hector's dolphins.

"The measures strike the best achievable balance between the protection of these iconic dolphins and the activities of our commercial and recreational fishers," said Fisheries Minister Jim Anderton.

He said the measures were estimated to cost the commercial fishing industry up to 295 jobs and £31 million over the next 10 years.

The dolphins grow to around 1.4 metres compared with up to four metres for the common Bottlenose dolphin, live around 20 years, and breed slowly.

They usually live in small groups of no more than five and feed on inshore fish species, which brings them into contact with fishing nets.

However, conservationists said the measures were barely adequate.

"At best today's decision is a half measure that fails to ensure the dolphins' recovery or survival," said Barbara Mass of the Care for the Wild International group.