Govt defends boat rescue efforts

The Australian government has defended search and rescue efforts for passengers from a sunken asylum seeker boat, while voicing fears that people smugglers may be rushing more people onto boats because of the change in Australian refugee policy.

As at 6pm (AEST) on Thursday, 22 people had been found under an operation coordinated by Indonesia's BASARNAS and supported by Australian authorities, about 45 nautical miles from Java.

But dozens remain unaccounted for from the boat, which was believed to be carrying up to 150 people, including women and children.

Home Affairs Minister Jason Clare defended the operation, led by BASARNAS. Advertisement

"Let's remember just how difficult this task is," Mr Clare told reporters in Sydney.

"This is a big stretch of water, and search and rescue is very hard.

"It's very hard to find people that are in distress on a little wooden boat in the middle of the Sunda Strait, or anywhere between Christmas Island and the coast of Indonesia.

"The Indonesia authorities deployed assets to try to find these people."

Immigration Minister Chris Bowen also cautioned people not to leap into criticism of the effort.

But the Australian Greens' Sarah Hanson-Young called for a full investigation of the "delay".

"We need to make sure we are doing absolutely everything we can to clear up any confusion as to who does what when," she said.

The Refuge Action Coalition called for an inquiry into Australia's response to safety-of-life-at-sea situations involving asylum seeker boats.

The Australian Maritime Safety Authority (AMSA) said the search for survivors would continue into Thursday evening.

The federal government hopes its new offshore processing policies will stop the flow of boats and prevent such tragedies at sea.

But Mr Clare says people smugglers are rushing to get people on boats before the detention centres on Nauru and Papua New Guinea's Manus Island are up and running.

"People smugglers are running a closing-down sale," he said.

Australia and Nauru on Thursday formally signed a memorandum of understanding allowing for the re-establishment of the Howard-era processing centre on the tiny Pacific island.

Mr Bowen expects to be able to send up to 500 asylum seekers to the island by the end of next month.

About 300 asylum seekers have died in the Sunda Strait between Java and Christmas Island since December.

© 2012 AAP