Russian rescuers said on Monday the bodies of 40 children may be trapped in the playroom of a pleasure boat that went down with up to 130 people on board in a heavy Volga River storm.

Rescuers used life vests to bring dozens of bodies to shore in a grim recovery operation accompanied by wails from grieving parents and anger from the Kremlin over what seemed to be basic transport security lapses.

The worst river boat disaster since 1983 came on top of a recent series of deadly Russian plane crashes and other technical glitches that highlighted the vast work the country needs to do to upgrade its Soviet era infrastructure.

But the pain of what happened on one of Russia's most important rivers became increasingly unbearable Monday as the hours passed and the number of survivors refused to edge up beyond the 79 people reported on Sunday.

Russia's emergency minister told President Dmitry Medvedev that 208 people had managed to make it on board the Bulgaria in gross violation of rules that permitted only 140 people to use the 56-year-old craft.

Other reports said the Bulgaria had not undergone renovations since 1980 and was only equipped with two of the four required rescue boats – with even those not being lowered because the craft was swallowed by the waters within minutes.

Medvedev responded by demanding a review of Russia's entire transportation infrastructure and requesting inquiries into why the ship had sailed with a broken left engine and without an operating license in violation of the law.

"We have enough old tubs floating around," Medvedev sternly told a government meeting in reference to outdated vessels.

"Based on the information we have today, the ship was in an unsuitable condition," Medvedev said in nationally televised remarks.

The range of violations detected on the ship are a particular embarrassment to Russian officials who are preparing the country for major international events such as the 2014 Winter Olympic Games in Sochi and the 2018 football World Cup.

Russian infrastructure problems and corruption have raised the most serious questions among organiser of both events and Medvedev has been at pains in recent months to convince the global community of imminent improvements.

The mood at the site of the disaster on Monday switched from shock to horror and disbelief.

Rescuers spent nearly 24 hours scouring the turbulent waters before encountering a Bulgaria cargo hold that was set up as a children's playpen with a special sandlot. Officials said their worst fears were confirmed with that find.

"The divers inspected the craft and found 30 to 40 children in the cargo hold," a member of the rescue operation told the Interfax news agency.

His comments supported earlier survivors' reports of dozens of children entering the playpen only moments before the boat sank. The rescuer said the children's bodies will only be recovered once the entire ship is raised in a delicate operation requiring the help of special barges equipped with cranes.

"The current is very strong in that section of the river," the rescuer said.

Officials are preparing a series of criminal investigations into why the Bulgaria set sail this weekend without a proper operating license and whether criminal negligence was involved.

Russia's transportation minister added that he planned to investigate survivor accounts of how a barge and an oil tanker had passed the stricken craft without stopping while people struggled in the water for their lives.

"We know these ships and their captains' names," RIA Novosti quoted Transport Minister Igor Levitin as saying. "We will use every means within the law to punish them as severely as possible," Levitin said.

A survivor named Nikolai Chernov told state television that "two boats went by without stopping even though we waved and waved."