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Delhi changes how hospitals buy medicines, equipment after multi-crore fraud case

The health department has put centralised procurement on hold as in interim measure

As an interim measure, the department has put its centralised procurement system on hold. (Express Photo)

3 min readNew DelhiAug 8, 2026 06:27 AM IST First published on: Aug 7, 2026 at 01:51 PM IST

Amid the multi-crore fraud case involving the purchase of medicines and medical equipment for Delhi government hospitals, the health department has made a crucial change.

As an interim measure, the department has put its centralised procurement system on hold, allowing individual government hospitals to buy medicines, surgical items and medical equipment directly.

The move comes weeks after the Anti-Corruption Branch (ACB) registered an FIR in connection with alleged irregularities in procurement through the Central Procurement Agency (CPA), where medical supplies — including bed sheets, linen items and ORS — were bought at inflated rates.

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The ACB has arrested Dr Vinod Kumar Ranga, former Head of Office of the CPA, former Director General of Health Services Dr Vatsala Aggarwal and CPA Deputy Controller of Accounts Neeraj Chopra in connection with the case.

What the order states

In its August 6 order, the Health Department’s CPA branch said that to ensure uninterrupted availability of medicines, consumables, surgical items, equipment and other essential healthcare commodities in government hospitals, the matter was first referred to the Finance Department.

The finance department observed that the procurement system was centralised in June 2025 and noted that “proposals involving any important change in policy” must be placed “before the Council of Ministers and cannot be concluded at the level of the Department”.

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The order was marked to Director, DGHS, Karkardooma, all MS/MDs/Head of Medical Institutions and Central Procurement Agency.

As an interim measure, in concurrence with the Finance Department, the Health department issued the following instructions:

-All pending and incomplete tenders, as well as those under process, initiated by the CPA are cancelled with immediate effect. The requisitions would be returned to the respective hospitals, which can now take further action and procure the items themselves according to the applicable rules.

-Existing rate contracts and procurement agreements already in force can continue until they expire or are terminated. However, the government will review them for any illegalities or procedural lapses and take action, if required.

-Procurement functions undertaken through the CPA are on hold, except for essential drugs. The order said until the CPA finalises rate contracts for these drugs, individual government hospitals will procure all medicines, including those on and off the Essential Drug List, through their heads of department in accordance with rules

-Procurement of consumables, surgical items, medical equipment and other healthcare commodities shall be undertaken by the hospitals.

The order directs hospitals to follow relevant guidelines until the “legal, financial, administrative and digital framework” for centralised procurement is fully in place.

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