Key Points:

New Zealand has retaliated to Fiji expelling its acting high commissioner by sending the Fijian high commissioner home, it was reported tonight.

TV3 reported that Fiji's high commissioner in Wellington, Ponsami Chetty, would be on the first flight home.

The expulsion came just over an hour after news from Suva that Caroline McDonald was told at 5pm she had been declared persona non grata in Fiji.

The action against Ms McDonald followed an announcement last night that she would not be expelled, and comments from the interim government that it wanted to improve its relationship with New Zealand.

Self-appointed prime minister Commodore Voreqe (Frank) Bainimarama threatened last week to expel Ms McDonald if a student visa was not granted to the son of a senior official in the president's office.

He was told last Tuesday it would not be granted.

Prime Minister John Key indicated yesterday there would be retaliatory action if Ms McDonald was expelled.