(CNN) -- The prime ministers of Australia and Malaysia on Saturday announced an agreement aimed at reducing human smuggling and illegal migration to Australia.
Under the deal struck between the two countries, the next 800 asylum-seekers who arrive in Australia illegally will be transferred to Malaysia for refugee status determination. In exchange, over the next four years, Australia will take in 4,000 refugees who are already residing in Malaysia.
"I made it very clear that what I wanted to do was to break the back of the people smuggling model, to take away from them the very product that they sell, to stop people risking their lives at sea and to stop people profiting from human misery," Australian Prime Minister Julia Gillard said at a news conference. "I wanted to see us do something to end the profitability of people smuggling."
The agreement is also seen as a way to address what has become a political debate in Australia over the arrival of unauthorized immigrants.
Thousands of refugees seek asylum in Australia each year, said Paul Power, CEO of the Refugee Council of Australia, an umbrella organization for groups that support refugees.
Each year, 4.1 million travelers visit Australia on temporary visas. Of those, 4,000-5,000 -- mostly from China -- seek asylum, Power said. But this isn't the group that has stirred controversy.
Opposition politicians have raised concerns about the asylum-seekers who are smuggled in, arriving in makeshift boats to the country. This amounts to a level of political fear-mongering, Power said.
Still, in the last several years, asylum-seekers who reach Australia illegally have reached about 4,500 per year, Power said. Most of those come from Afghanistan, Sri Lanka, Iraq, Iran and Burma, and go travel through Malaysia -- a transit point for many refugees headed for Australia.
The agreement is an attempt to remove the incentive to sneak into Australia.
"Under this arrangement, if someone seeks to come to Australia then they are at risk of going to Malaysia and going to the back of the queue -- that's what it means," Gillard said.
In other words, those 800 who are transferred from Australia to Malaysia will not get preferential treatment over those refugees who are already there and have already begun to apply for asylum in Australia.
But Power sees some red flags with the new deal.
For one, he said, Malaysia, unlike Australia, is not a signatory to the 1951 U.N. Refugee Convention. Malaysia does not have a good record of dealing with refugees and has been down to arbitrarily detain asylum-seekers, Power said.
According to the agreement, the U.N. High Commissioner for Refugees will be process the asylum-seekers once they arrive in Malaysia.
Despite the political fires being stoked in Australia over unauthorized asylum-seekers, there is broad bipartisan support in the country for its resettlement program.
Under the deal, for every migrant sent from Australia to Malaysia, Australia will intake five refugees from Malaysia.
"We've been a generous country in the past over our history, over many decades resettling people who were fleeing persecution and of course I believe we will continue to do that over the years to come," Gillard said.
Other steps will be taken in the future to address the migration issue as well, she said.