Coast guard PRO said ships which were at sea have been diverted to the site of mishap and ships are also sailing from Mumbai.
The boat was two nautical miles from the shore when the incident occurred.
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Local BJP MLA Manisha Choudhary claimed that the boat was ferrying around 40 children. Search operations for the remaining are underway.
In addition, the Coast guard vessels and Dornier aircraft has been deployed for the rescue operations. Local fishermen and agencies have rescued 32 children. "Rescue teams from other departments are also there", Superintendent of Police, Palghar was quoted saying.