0854 GMT February 28, 2020
Victims included a woman and a child who jumped from a window to escape the blaze that broke out before dawn at the budget Hotel Arpit Palace, AFP reported.
Images showed flames and thick smoke billowing out of the top floor of the hotel, located in a congested part of the Indian capital.
Guests at the hotel – popular with budget and business travelers – were unable to use corridors to escape because of wooden paneling, according to a fire officer.
Delhi home minister Satyendra Jain told reporters that rules were flouted to construct extra floors, with a terrace being used as an open air restaurant.
He also directed the fire department to inspect other buildings in the congested area and file a report within a week.
Three Myanmar citizens staying at the hotel were missing, the NDTV news network reported.
Most of the guests were sleeping at the time the fire broke out and suffocated to death.
Four people were injured in the incident.
It is estimated around 120 people were inside the hotel – built around 25 years ago – when the fire started.
"We have confirmed with hospital authorities the toll is now 17 including a child," Sunil Choudhary, a senior fire brigade official, told AFP.
G.C. Misra, Delhi fire services director, said the blaze had been brought under control and that 35 people were rescued by firefighters in an operation lasting several hours and involving at least 25 fire engines.
"There was wooden paneling on corridors because of which people could not use corridors to evacuate," another fire officer told reporters.
Police said they were investigating the cause, and a judicial probe has been ordered into the latest disaster to raise concerns over fire safety in India.
The area, which houses hundreds of hotels, shops and offices, is packed with tourists and shoppers.
Three members of an extended family were among the dead. They were part of a group of 13 from southern Kerala state who had come to Delhi for a wedding.
Fires are common across India because of poor safety standards and lax enforcement of regulations.
Activists say builders and landlords often amend building plans to add space, and ignore safety norms to save costs.
Prime Minister Narendra Modi said he was "deeply saddened" by the loss of life in a statement posted on Twitter.