Indonesian police say that 29 people have been killed and another 292 rescued after a ferry sank off the country's Sumatra Island.

The ferry reportedly sank on Sunday morning when it was heading from the port of Batam to Dumai in Riau, said Yasin Kosasih, a police chief in Riau province.

Sea transport director-general Sunaryo said the numbers were based on reports from senior officials on Karimun Island near Singapore, close to where the ferry went down.

"From the Karimun mayor, 292 people are reported safe," he was quoted as saying by AFP.

He said the ship's capacity was only 273 passengers and an investigation was underway to determine if overloading contributed to the accident.

The South Asian country with 234 million population and 17,000 islands is dependent on a network of ships and boats.

In one incident in January, nearly 335 people drowned when a ferry sank off Sulawesi Island.

AGB/SC/DT