At least 163 people died when a ferry capsized off the popular tourist archipelago of Zanzibar, but over 100 people are still missing, a minister said on Saturday.

"We have recovered 163 people who have died and we have rescued 325 survivors," said Mohammed Aboud, Zanzibar's state minister for emergencies, dramatically updating an earlier death toll of 53.

At least 40 of those rescued were seriously injured, including some hit by falling debris as the boat rolled onto one side, he said, adding that the death toll could still rise higher.

Officials said that around 600 people were believed to have been on the stricken ferry, including families returning home after the holidays to celebrate the end of the Muslim holy month of Ramadan.

Survivors have begun arriving back in Stone Town, the main port and capital of the archipelago, with an emergency first aid centre set up in the port to treat those arriving by rescue speed boat from the capsized ferry.

"It was terrifying, people were screaming and shouting in the dark," said Aisha Mohammed, aged seven.

"I can't find my mummy, I lost her when we were all in the water," she added, after being picked up by a rescue boat.

Other survivors angrily accused port and ferry officials of overloading the boat.

"We were shouting at the captain and at the people in the port even before we left that the boat was too full, it was packed with people and with cargo," said Zaid Amour, a 50-year-old survivor.

"This was not an accident but is the fault of those who did not stop the boat from leaving when it was clear to passengers it was not safe."

The government pledged to do all it could to help.

"This is a national tragedy, so let us join hands together over this," said Ali Mohammed Shin, president of the semi-autonomous archipelago.

"The government of Zanzibar will do everything that it can to support the victims of this terrible event."

The exact number of passengers on this type of ferry is often difficult to establish as no reliable passenger lists are kept.

"We have asked for emergency assistance from Dar es Salaam, including divers, to help in the rescue efforts," Aboud told the media.

The MV Spice Islander, which was travelling between Zanzibar's main island Unguja and Pemba, two of the three islands that make up Zanzibar, left Unguja around 9:00 pm (1800 GMT) and capsized four hours later.

"Sailors on the boat were still telling us 'it is ok' when we were calling for life jackets, so when things got really bad it was too late for many people," Amour added.

The ferry was reportedly carrying a heavy cargo of rice and other goods.

"Rescue operations are being hampered by a lack of equipment," deputy secretary of state for infrastructure and communication Issa Gavu told the media.

No foreigners have so far been reported amongst either the dead or rescued, according to the media reporter at the scene.

Ferries have a poor safety record in Tanzania. In May 2009, a ferry capsized leaving six people dead, while several fires on cargo boats have been reported in recent years.

Tourism is the main foreign currency earner for Zanzibar, famed for its white-sand beaches and historical buildings in Stone Town, listed as a world heritage site by UNESCO, the United Nations cultural organization.

Pemba lies some 80 kilometres (50 miles) north-east of Unguja.