More than 60 Rohingya Muslim refugees are feared dead after a boat carrying them from Myanmar capsized, leaving distraught relatives to hold burials on Friday in squalid Bangladesh camps which the Red Cross says are tipping into a health crisis.

Half a million Rohingya have crushed into settlements in Bangladesh in just over a month, fleeing a Myanmar army campaign and communal violence that the UN describes as “ethnic cleansing”.

They have poured over on foot or crossed the Naf river which bisects the two countries in overcrowded boats.

One of these vessels capsized in rough waters on Thursday agonisingly close to the shore, survivors said, as the Bangladeshi captain lost control after pushing far out to sea for two days to avoid patrols.

The bodies of 23 people have been retrieved so far but the death toll is expected to surge to around 60, with many of the dead likely to be young children too weak to swim through the churning water.

“Forty are missing and presumed drowned,” International Organisation for Migration spokesman Joel Millman told reporters in Geneva.

Survivor Abdus Salam told AFP the boat hit trouble within striking distance of the Bangladeshi coastline. “He didn't see a rock underneath the water and we hit it.”

Refugees on Friday held funerals for loved ones — among them children — who had hoped to find sanctuary from violence that has cut through their homeland in Rakhine state.

A woman carried a small white bundle to a grave for a Muslim burial, while male relatives wept at a school building where bodies had been laid out.

“My wife and two boys survived, but I lost my three daughters,” Shona Miah, 32, told AFP.

One toilet for hundreds

Those who have made it to Bangladesh have been squeezed into a vast makeshift refugee settlement that has become one of the world's biggest in a matter of weeks.

Relief groups are overwhelmed by the numbers of hungry and traumatised Rohingya and medical staff say the camps are in imminent danger of disease outbreak.

“Our mobile clinics are treating more people, especially children, who are very sick from diarrhoeal diseases which are a direct result of the terrible sanitation conditions,” said Mozharul Huq, secretary general of the Bangladesh Red Crescent Society.

In some of the camps hundreds of refugees are sharing a single toilet, said Martin Faller, of International Federation of Red Cross and Red Crescent Societies (IFRC).

“The conditions for an outbreak of disease are all present — we have to act now and we have to act at scale,” he added.

The UNHCR says nearly one in five of arrivals is suffering from “acute malnutrition”, while aid groups have pledged to deliver 900,000 doses of cholera vaccine to Bangladesh within a fortnight.

Worsening conditions are compelling Rohingya to try to move out of the wedge of land Bangladesh has set aside for the new arrivals.

But Bangladesh police have stopped more than 20,000 Rohingya from going inland, a senior official said Friday, after authorities imposed travel restrictions on the refugees fearing they will move further into the country.

Bangladesh has urged Myanmar to allow a safe return for the Rohingya.

Myanmar says it is ready to begin repatriating refugees to a camp in the Maungdaw district of northern Rakhine.

But rights groups say the criteria for return is convoluted and carefully crafted to take back as few of the minority as possible.

Many Rohingya do not possess the requisite documents to be allowed back or are unwilling to return to villages that have been burnt to the ground.

The Muslim minority are loathed in Myanmar, where they are denied citizenship and are instead branded “Bengalis” — or illegal migrants who do not belong in the Buddhist-majority country.

UN warnings

Attacks on police posts in Rakhine by Rohingya militants on August 25 set the crisis in motion.

The kickback by Myanmar's army killed hundreds and left scores of Rohingya villages in ashes.

Rohingya who fled say they survived slaughter by soldiers and ethnic Rakhine Buddhists who were once their neighbours.

Ethnic Rakhine and Hindus have also been displaced inside Rakhine, accusing Rohingya militants of atrocities.

Rohingya are still on the move and UN chief Antonio Guterres has warned that the “systemic violence” could spill further south to the central part of Rakhine, threatening a further 250,000 Muslims with displacement.

Nearly 90 non-governmental organisations, including Amnesty International, have issued a joint statement denouncing “crimes against humanity” against the Rohingya in Myanmar and calling on the international community to immediately end military assistance to the country.

On Thursday the UN Security Council failed to agree on a joint resolution, after China and Russia supported Myanmar.

But the UN Human Rights Council said Friday it would extend an international fact-finding mission into abuses in Myanmar by another six months.

Access to the violence-stricken part of Rakhine is tightly controlled by the military, preventing international aid groups reaching desperate Rohingya or independent reporting on the crisis.