The failure of a workhorse Proton rocket after launch on Monday caused the multimillion-dollar loss of Indonesia's Telkom-3 and Russia's Express-MD2 satellites, according to Russia's space agency.

Russian space agency Roskosmos said an engine failure in the rocket's upper stage, called the Briz-M, meant the craft went into the wrong orbit. A similar problem caused the loss of a $265 million communications satellite last year.

"I don't know the reason for the loss of our satellites - whether it is the upper stage, mechanical damage, elementary negligence or everything together - but we cannot stand this any longer," Medvedev said at a televised government meeting.

"We are losing our authority and billions of roubles."

Medvedev said he would hold a meeting on the subject next week and ordered government officials to look into recent failures. "They must report their recommendations on who to punish and what to do further."

Moscow is struggling to restore confidence in its space industry after a series of mishaps last year, including the failure of a mission to return samples from the Martian moon Phobos.

Such failures for Russia, which conducts 40 percent of global space launches, may undermine its standing in the market, strengthening competitors such as Europe's Ariane rocket.

Telkom-3 was the first satellite Jakarta had purchased from Moscow, built by Russia's ISS-Reshetnev with communication equipment made by French-led satellite maker Thales Alenia Space. Express-MD2 was a small communication satellite, made for the Russian Satellite Communications Company.

(Reporting By Alissa de Carbonnel; Editing by Robin Pomeroy)

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