The KMP Tunu Pratama Jaya sank almost half an hour after leaving East Java province’s Banyuwangi port on its way to Bali late on Wednesday, the agency said on Thursday.
The boat was carrying 53 passengers and 12 crew members, as well as 22 vehicles, the agency said.
A search for the missing is underway although it is being hampered by strong currents and winds, the agency said, adding it had deployed a helicopter to the location and 13 underwater rescuers.
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Video provided by the national rescue agency Basarnas showed what appeared to be the body of one person being carried to shore from a fishing boat in calm seas.
There has been no official statement on the nationalities of the passengers, but a manifest list broadcast by news channel MetroTV indicated there were no foreigners on board.
Ferries are a common mode of transport in Indonesia, an archipelago of more than 17,000 islands, and accidents are common as lax safety standards often allow vessels to be overloaded without adequate life-saving equipment.
