Flagging cost escalations in medical infrastructure projects, the Delhi government’s expenditure finance committee (EFC) has ordered a vigilance inquiry into an arbitration award linked to the Lok Nayak Jaya Prakash (LNJP) Hospital expansion, according to July 22 minutes of the meeting, seen by HT

During the meeting chaired by chief minister Rekha Gupta, the committee alleged that the payment of an arbitration award worth ₹94.61 crore—including ₹82.44 crore as the award amount and ₹12.17 crore as interest—was one of the major reasons for the sharp escalation in project cost.

It directed the health department to submit a comprehensive report to the competent authority detailing the background of the dispute, the chronology of events, a legal opinion, the financial implications, and the approvals granted at different stages.

The EFC also ordered a vigilance inquiry to examine the decision-making process that led to acceptance of the arbitration award and release of the payment.

Construction on the new 25-floor Lok Nayak wing — three levels below the ground, and 22 above — began in November 2020 during the previous Aam Aadmi Party government with May 2023 deadline. However, the project missed multiple deadlines, with cost escalations as one of the reasons.