Australia will give Sri Lanka two patrol boats to intercept asylum seekers before they leave Sri Lankan waters under a new deal to be signed Sunday.

Asylum seekers caught by the Australian-built boats in Sri Lankan or international waters will be returned to Sri Lanka immediately.

The deal was immediately slammed by the Refugee Council of Australia, which said it was the first time Australia had directly co-operated with a refugee ''source'' country.

''This is an arrangement between Australia and a country where people are fleeing, in situations where many people believe that they have a well-founded fear of persecution,'' chief executive Paul Power said.

''So, Australia is co-operating with a state with a very poor human rights record from which quite a number of people have fled and have been found to be in need of refugee protection.''