SYDNEY (AFP) - India has become the leading source of permanent migrants to Australia for the first time, ahead of China, a government report showed on Monday.

Reflecting the growing prominence of Asia to Australia, seven of the top 10 source countries during 2011-2012 were from the region, Australia's Migration Trends study showed.

"Between 1996 and 2011, Australia's overseas-born population grew by more than 40 per cent to reach six million," said Immigration Minister Brendan O'Connor.

"This was more than double the rate for the Australian-born population and is essential in addressing the demographic challenges of an ageing population.

"With the government's strong emphasis on skilled migration, this sort of growth is also crucial to ensuring depth in Australia's labour force."

The number of permanent migrants from India was 29,018 in 2011/12, up 12.7 per cent on the previous year.

China was number two as visa places fell from 29,546 to 25,509.

During the same time British arrivals rose to 25,273 from 23,931 with the Philippines and South Africa four and five respectively.

The report showed that during the past 15 years the number of Indian-born Australian residents increased four-fold while Chinese-born residents tripled.

However, Britain remained the main birthplace of migrants, with 1.18 million calling Down Under home from a total population of 23 million.

New Zealanders are the second biggest (564,920) followed by China (391,060).