An asylum-seeker boat from Sri Lanka believed to be carrying 200 people capsized off remote Christmas Island on Thursday with an unknown number of survivors, Australian and Indonesian authorities said.

A boat claiming to be fleeing Afghanistan 

The Australian Maritime Safety Authority said the ship issued a distress call mid-afternoon and capsized 120 nautical miles north of the Indian Ocean territory, some 2,600 kilometres (1,600 miles) from the Australian mainland.

The accident could become one of the worst refugee boat disasters off Australia for more than a decade.

"There is a capsized vessel 120 nautical miles north of Christmas Island, there's believed to be approximately 200 people on board," an AMSA spokeswoman told AFP.

"We can confirm there are survivors but we can't confirm numbers at this stage," she said. "The Indonesian search and rescue authorities are co-ordinating the response."

Gagah Prakoso, a spokesman for Indonesia's search and rescue service, said they had been informed by AMSA that "the boat was in Indonesian waters heading to Australia to seek asylum".

"It was coming from Sri Lanka and going to Christmas Island, and it is already on the Australian (maritime) border," Prakoso told AFP. "Two Indonesian navy ships are heading to the site."

Australian Customs said a border patrol aircraft spotted the vessel in distress in Indonesia's search and rescue zone at about 3pm (0500 GMT) and "it is believed up to 200 people could be on board".

Three merchant vessels and two Australian military ships had responded to a regional maritime alert and were on their way, and a fixed-wing P3 Orion aircraft was on the scene, according to AMSA.

Two aircraft had been deployed including one equipped with liferafts, Customs added.

Though they come in relatively small numbers by global standards asylum-seekers are a sensitive political issue in Australia, dominating 2010 elections due to a record 6,555 arrivals.

Direct asylum-seeker journeys from Sri Lanka have historically been rare but a spate of attempts have been reported recently, with one boat stopped before leaving Sri Lanka last month and another intercepted by Indian police.

Both were carrying more than 100 passengers.

Indonesia is a more common transit point for those trying to reach Australia's Christmas Island, which is closer to Java than mainland Australia, but many of the overloaded, rickety vessels do not reach their destination.

In December, a boat carrying around 250 mostly Afghan and Iranian asylum-seekers sank in Indonesian waters on its way to Christmas Island, with only 47 surviving.

Some 50 refugees were killed in a horror shipwreck on the remote island's cliffs back in December 2010 when their leaky wooden vessel was dashed on the rocks.

Fifteen were children aged 10 years or younger, with one a baby just three months old.

So far this year 62 vessels carrying 4,484 boatpeople have been intercepted off Australia, an unprecedented number in a six-month period.

Arrivals have increased steadily since Canberra was forced to abandon a so-called "people swap" deal with Malaysia by the High Court last year and roll back its mandatory detention policy for boatpeople.

The government has had to release hundreds of asylum-seekers into the community while their applications are processed due to the strain on detention centres, the budget for which has now spiralled above USD1 billion.

A number of asylum boats have been intercepted in the area in the past 24 hours carrying more than 200 passengers, prompting Home Affairs Minister Jason Clare to issue a statement calling for an urgent political compromise.

"Let's remember what this is all about -- 200 people died off the coast of Indonesia and another 11 died off the coast of Malaysia," Clare said in a statement earlier Thursday, referring to previous recent accidents.