NEW DELHI (REUTERS) - India's northern state of Uttar Pradesh has suspended the head of a hospital where at least 60 children died, while the federal health minister on Sunday (Aug 13) vowed action against the culprits, as state and hospital officials traded blame over funding matters.

The government in Uttar Pradesh, run by India's ruling Bharatiya Janata Party (BJP), suspended the head of the state-run BRD Medical College, Rajeev Misra, late on Saturday and ordered an investigation into contracts to supply oxygen.

Media have said the deaths of the children, 34 infants among them, were caused in part by an oxygen shortage after a private supplier withdrew its equipment over unpaid hospital dues.

Hospital officials have denied this, saying alternative supplies had been found, and blamed many of the deaths instead on the disease encephalitis and unspecified issues related to delivery of the infants.

On Sunday, J.P. Nadda, health minister in Prime Minister Narendra Modi's cabinet, visited the hospital in the town of Gorakhpur, 800km east of New Delhi, accompanied by the state's chief minister, Yogi Adityanath.

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Nadda promised "strict action" against the culprits in an interview with the news channel NDTV, before his departure from the Indian capital.

The issue of the unpaid bills for oxygen supply has become a flashpoint in relations between the hospital and the state government, after the suspended hospital chief on Saturday accused state officials of ignoring his requests for money.

"I wrote at least three letters," Misra told television reporters on Saturday, adding that he had even flagged the issue in video conference discussions.

Reuters was unable to immediately contact Misra to seek his comments.

The Uttar Pradesh health minister defended the government's role, saying no issue of unpaid bills had been brought to its attention and all requests for funds were paid promptly.

PRESSURE ON BJP

Opposition parties have stepped up the pressure on the state government, demanding the resignations of Adityanath and the state health minister.

"Utter failure of Chief Minister Yogi's government, who have the blood of more than 60 lives on their hands," the opposition Congress party said in a message on social network Twitter.

Uttar Pradesh is India's most politically prized state, where the BJP's thumping victory has strengthened Modi's claim to a second term in 2019.

Gorakhpur, a down-at-heel town near India's border with Nepal, is Adityanath's political base, which elected him to parliament five times before Modi asked him to lead Uttar Pradesh, after a landslide BJP election victory in March.

But the town's health facilities are seen as deficient, with a study of government data by nonprofit body Brookings India showing the district has a 26 per cent shortage of primary health centres.

Encephalitis outbreaks kill hundreds in India every year, especially during the monsoon season.

India spends about one per cent of GDP on public health, among the world's lowest. In recent years, Modi's government has increased health spending and vowed to make healthcare more affordable.