Indonesia's rescue agency was alerted by Australian authorities on Tuesday evening.

"We don't know exactly how many were on board, so we're focusing on searching for any more that may be out there," Bandung search and rescue chief Rochmali told AFP early Wednesday, adding the figure would likely be between 100 and 200.

"We don't know where these people are from. We will just focus on ensuring they're well and making sure no one else is still at sea," he said.

The boat sank in heavy seas off the fishing town of Cidaun in western Java, from where rescuers set out in their own boats and in vessels lent by the police and fishermen.

Survivors would be taken to hospital, Rochmali said, adding the body of one child, the only confirmed dead, had been recovered.

Reports in Australia said the asylum seekers were mostly from Sri Lanka and Iran.

"I am the only one back," said a man named Soheil of a group of 61 Iranians he was travelling with, as quoted by the Sydney Morning Herald newspaper.

He confirmed he had set off from Cidaun.

"We have (sic) problem with motor after two hours. For three hours, we try to come back (to shore)," he said.

Soheil said the captain -- who he claimed was a Sri Lankan man using a Malaysian crew -- abandoned them.

"The captain go (sic) to small boat," he told the Telegraph.

Australia has struggled to stem an influx of asylum-seekers arriving by boat, with record numbers turning up in 2012 and more than 15,000 so far in 2013.

Hundreds have drowned making the journey -- as recently as last week a boat sank, killing four people -- with the latest disaster coming just days after Canberra announced a hardline new plan to send all unauthorised arrivals to Papua New Guinea.

Asylum-seekers arriving in Australian waters will now be sent to the Manus Island processing centre on PNG and elsewhere in the Pacific nation for assessment, with no cap on the number that can be transferred.

Even if found to be "genuine refugees", they will have no chance of being settled in Australia, instead having to remain in PNG, be sent back home or to third countries.

In a bid to smash the lucrative people-smuggling networks, Australia on Sunday also announced it would pay rewards of up to A$200,000 (US$180,000) for information leading to their conviction. (AFP)