US Ambassador to India Sergio Gor has decided to cancel a planned upgrade and expansion of the American Embassy in New Delhi over ballooning costs, causing consternation among some in Washington, HT has learnt.
Event Context
The project, a former senior US official said, represented a long-overdue need to modernise the US mission in New Delhi. “Over time, embassies need upgrades for a variety of reasons. For example, security requirements have changed dramatically since the time that the Embassy in New Delhi was constructed, which I understand was around 1960. That embassy is no longer in compliance with today’s guidelines and has many other obsolete features,” the former official said.
In 2021, Washington announced that it had broken ground on an $874 million effort to renovate the embassy in New Delhi. The project – executed by the New York-based architectural firm Weiss-Manfredi – intended to construct a new multi-building complex complete with a modern chancery and office annex, staff residences, and support facilities. In addition, plans included a renovation of the historic Edward Durrell Stone Chancery building – the 1959 inauguration of which was attended by then prime minister Jawaharlal Nehru.
Getting approvals from the State Department and then funding from the US House of Representatives can be time-consuming, the official said, with a long list of embassies globally starved of funds. After a long delay, the nearly $874 million upgrade to the embassy was approved.
HT has learnt that, by one estimate, roughly half a billion dollars had already been spent on the expansion project, which has led to concerns that the cancellation will mean a waste of taxpayer funds. For example, one former senior official points out that a large pit was dug near Roosevelt House—which typically functions as the ambassador’s residence in New Delhi—in an effort to build below-ground meeting rooms and facilities. The pit was subsequently filled without the needed construction, raising concerns about wasted taxpayer funds.
To be sure, people familiar with the matter do not dispute the assertion that the project did face delays.
Team Analysis
Although the State Department clarified that Secretary of State Marco Rubio and the Bureau of Overseas Building Operations signed off on the cancellation, US Ambassador Sergio Gor has been seen as the prime mover behind the decision. People aware of the matter said Gor’s unique position—especially his well-advertised closeness to US President Donald Trump—allowed him to make a decision that few other former ambassadors would have felt able to.
Match Outlook
The renovation—which first broke ground before Donald Trump left office in 2021 and was estimated to cost nearly $874 million at the time—was one of the largest such projects undertaken by the US anywhere in the world. In a June interview with The New York Times, US Ambassador Sergio Gor said the project’s cost had ballooned to $1.2 billion, with an expected completion date of 2036—nine years behind the original 2027 deadline—and announced that it had been cancelled.
A US State Department spokesman told HT that the decision to cancel the expansion was taken in December 2025.
Former senior US officials as well as figures on Capitol Hill expressed dismay to HT that the project—which had been years in the making and represented a long-overdue upgrade to an ageing embassy first built in the 1950s—had been cancelled midway without apparent regard for the security implications of the decision and without proper prior notification to the House of Representatives, which had appropriated the funds for the project.
During the June interview with The New York Times, US Ambassador Gor argued that the project’s costs had ballooned to an estimated $1.2 billion, with an expected completion date of 2036, compared with the original 2027 completion date.
Both the substance and the process of Gor’s announcement have drawn ire in Washington, HT has learnt. Key figures on Capitol Hill expressed ire at the news that the embassy expansion had been cancelled.
“This is an important diplomatic mission, and canceling its expansion has real consequences. If the Delhi embassy project was facing insurmountable delays, State should have notified Congress immediately. Instead, the Department kept telling us it was on track, even though Rubio canceled the project last year. Why did the State Department mislead Congress all these months?” said Congressman Gregory Meeks, who serves as the top Democratic lawmaker on the House Foreign Affairs Committee.
Another matter of contention is Gor’s assertion that the embassy project’s cost had ballooned to $1.2 billion and would be completed only in 2036. However, information on the project circulated by the State Department in May indicated that the project’s cost stood at $1.048 billion, with an expected completion date of October 2029.
In response to a query from HT, a State Department spokesperson argued that the department regularly reviewed the progress of projects to ensure that money was being spent to promote the interests of the US taxpayer.
“As with any construction project, embassy renovation projects often take longer than expected. The COVID pandemic interrupted all construction projects at various embassies. In the case of a country such as India, you also have regulatory slowdowns and the impact of the monsoon season. Clearly, the Congress and the State Department thought that a renovation at the Embassy in India was necessary given the outdated facilities and other concerns. To stop such a project mid-term adds significant costs to remediate the construction site and then, at some point down the road, re-bid the remainder of the project at what will likely be a much higher cost,” said a former senior US official.
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The timing of the cancellation decision, HT has learnt, is key. According to a New York Times report, satellite images showed that a pit dug for an expansion of the embassy’s facilities had been filled by April. However, even in May 2026, the State Department indicated to people aware of the matter that work on the embassy expansion was ongoing. It did not indicate that a major cancellation or disruption of expansion plans was already in the works, HT has learnt.
