Taking a stand: Prime Minister Kevin Rudd and Indonesian President Susilo Bambang Yudhoyono after the annual Australia-Indonesia Leaders' meeting.

Taking a stand: Prime Minister Kevin Rudd and Indonesian President Susilo Bambang Yudhoyono after the annual Australia-Indonesia Leaders' meeting. Photo: Alex Ellinghausen

Indonesian President Susilo Bambang Yudhoyono has thrown the Labor government a lifeline on asylum seekers, offering his own solution to the problem while repudiating Opposition Leader Tony Abbott's plan to turn boats around.

The Indonesian president on Friday offered to host a dedicated summit aimed at solving the problem which has dogged relations between Jakarta and Canberra, and was front and centre at talks with Prime Minister Kevin Rudd.

But even as Dr Yudhoyono was hosting Mr Rudd at a presidential palace in Bogor, near Jakarta, it emerged that a boat carrying about 80 asylum seekers was the subject of an ongoing search and rescue operation in waters between Java and Christmas Island.

The Australian Maritime Safety Authority (AMSA) confirmed that it had issued an alert to ships in the area that the boat was taking on water.

An Australian navy patrol boat was expected to arrive at the location 42 nautical miles from Java later on Friday, while a Customs Dash 8 surveillance aircraft had also been deployed.

The unfolding drama came as Dr Yudhoyono delivered a telling rebuke of Mr Abbott's plan to tow boats back to Indonesia with insistence that ''unilateral action'' be avoided featuring prominently in a joint communique issued after the talks with Mr Rudd.''

As co-chairs of the Bali Process the two leaders reaffirmed their commitment to developing a regional solution involving countries of transit, origin and destination,'' the communique said.

The communique also ''stressed the importance of avoiding unilateral actions which might jeopardise such a comprehensive regional approach and might cause operational and other difficulties to any party.''

Dr Yudhoyono said that ''all parties must be responsible and they all must take action that is concrete''.

''Of course it is also not fair if only the Australians (are left) to resolve this matter. I wish to underline that it is really necessary that we have concrete cooperation.''

The meeting proposed by Dr Yudhoyono, which would involve countries of origin, transit and destination from around the region, would likely be held before the end of the month.

The one-off summit would not replace the regional framework for dealing with people smuggling - known as the Bali Process - but would have an ''action orientated'' focus, Dr Yudhoyono said.Mr Rudd praised the Dr Yudhoyono for his leadership, describing the summit plan as a ''bold initiative''.

''This problem of people smuggling is a problem for our entire region, therefore the president's initiative is for all of us to work now together,'' Mr Rudd said.

In Australia, Mr Abbott maintained that his plan of turning boats around was preferable to letting the navy act as ''an escort service for the people smugglers''.''I think it's an embarrassment to our country because the people smugglers are having a lend of us.

''I suspect the naval personnel would be only too happy to respond to orders that allow this problem to be solved.

''Meanwhile, there were grave concerns as night approached with efforts underway to reach an asylum seeker boat which got into trouble while making the perilous crossing to Christmas Island after leaving from Indonesia.''It's reported that there are 80 people on board,'' an AMSA spokeswoman told AAP.

''We believe they are taking on water.''

The rescue mission was mounted after AMSA was contacted directly by someone on the stricken boat.

AAP