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Defence chief Angus Houston said the unidentified boat capsized and then sank after the LNG Pioneer ship and Taiwanese fishing craft responded to pleas for help in a remote area off Australia's Cocos Islands in the Indian Ocean.
It was not confirmed whether the boat was one of dozens of people-smuggling vessels that have headed to Australia this year carrying more than 1,700 asylum-seekers, many of them from Sri Lanka and Afghanistan.
"I understand when the first ship got there, this vessel was still intact," Houston said.
"Somehow or other during the process of interaction between the ship and trawler and also the stricken vessel, there's been a capsize and people ended up in the water.
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Some 19 people were rescued by the Bahamas-based gas tanker and fishing boat, while an air force plane dropped a life raft near another five survivors, Prime Minister Kevin Rudd said.
"I think it's fair to say there are grave concerns about a number of those people -- we understand there