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The Turkish coastguard on Tuesday recovered the bodies of nine people including two babies after their boat sank just a short distance from land while trying to reach Europe.

The coastguard said it discovered the boat half capsized only 25 metres (yards) from the coastline after it set off from the western  town of Seferihisar in an apparent bid to reach Greece.

Two survivors had been rescued, the coastguard said in a statement, adding that the search was continuing in the Aegean.

The nationalities of the victims were not immediately known.

The deaths come after 37 people drowned off another part of the Turkish coast on Saturday - in harrowing scenes reminiscent of the death of Aylan Kurdi, the Syrian toddler whose tiny body was found lying face down on a Turkish beach in September.

Turkey reached an agreement with the European Union in November to stem the flow of migrants bound for Europe in return for three billion euros ($3.2 billion) in financial assistance.

But the agreement has failed to check the tide of arrivals, many of them refugees from Syria fleeing the conflict in their homeland.

Turkey, which is hosting at least 2.5 million refugees from Syria, has become the main launchpad for people fleeing war, persecution and poverty to Europe.

Tougher penalties for smugglers

Brussels is pressing Ankara to implement tighter border controls because neither the Turkish-EU deal nor harsh winter conditions appear to have deterred migrants, many of whom pay people smugglers thousands of dollars for the risky crossing.

The Turkish government said on Monday it was working on new legal measures to strengthen penalties for human smuggling by making it an "act of terror and organised crime".

The International Organisation for Migration (IOM) said on Tuesday that the number of refugees and migrants who perished in the Mediterranean in January alone topped 360.

In January, almost 62,200 migrants and refugees entered Europe through Greece, according to the IOM.

Surveys by the Greek authorities indicate that 91 percent came from three countries - Syria, Afghanistan and Iraq, it said.

Turkish President Recep Tayyip Erdogan said on Monday his country had spent more than $9 billion (8.2 billion euros) in services for the refugees.

Nobody should see this issue as a problem only for the east. This is an issue of the humanity - Turkish Deputy Prime Minister Numan Kurtulmus

"Turkey has opened its doors without distinction to more than 2.5 million Syrian and Iraqi refugees," he said on a visit to Chile - a figure that dwarfs the one million who reached Europe last year.

Deputy Prime Minister Numan Kurtulmus told reporters on Monday that the costs were increasing by the day.

"Nobody should see this issue as a problem only for the east. This is an issue of the humanity," he said.

He said the EU funds would not go into Turkey's budget but be spent directly tackling the humanitarian crisis.

EU member Italy has questioned how much of the money should come from the EU budget, and how much control the bloc will have over how Ankara spends the funds.