(Adds statement from Maliki's office)

BAGHDAD, Oct 19 (Reuters) - Britain's new Defence Secretary John Hutton made his first visit to Iraq on Sunday, accompanied by officials who will discuss with Iraqi counterparts the future of the British military mission in Iraq.

"Prime Minister Nuri al-Maliki declared that Iraq will form a negotiating team to discuss the future of the presence of British forces in Iraq," Maliki's office said in a statement after the two men met at his office in the Green Zone fortified government and diplomatic compound.

"The prime minister confirmed that it is time to build a better relation with the states who stood beside Iraq against dictatorship."

Hutton, the former business secretary, took over the defence portfolio in Prime Minister Gordon Brown's cabinet reshuffle on Oct. 3. Britain has about 4,000 troops in Iraq, mainly at an air base outside the southern city of Basra.

Britain, like the United States, is negotiating a bilateral agreement with Baghdad to allow its troops to stay on after a U.N. Security Council mandate expires at the end of the year.

Britain was the main partner of the United States in Iraq during the invasion in 2003, sending 45,000 troops to the Gulf in its biggest overseas deployment in 50 years.

In recent years British forces have drawn down their presence in Iraq substantially, and most of the areas they once patrolled are now in the hands of Iraqi security forces or American troops.

Maliki told the British newspaper The Times last week that Iraq no longer required British combat power, although it could still use British military trainers. (editing by Matthew Jones)

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