Diplomat Devyani Khobragade at the centre of a bitter row with the United States has been stripped of her duties over unauthorised statements to media, a government source and reports said on Saturday.

Ms Khobragade was arrested and strip-searched in New York last December while serving as India's deputy consul-general on charges of mistreating her servant.

She had denied the charge and subsequently returned to India, but the incident triggered fury in New Delhi and led to the resignation of then US ambassador Nancy Powell.

Reports on Saturday said Ms Khobragade has been removed from her current post in the foreign ministry for an unauthorised media interview and for not disclosing that her children held US passports.

"The reports are not incorrect. It is true that she has been placed on compulsory wait," a source in the ministry told AFP on condition of anonymity, adding that Ms Khobragade now faces an administrative inquiry.

Compulsory wait implies that Ms Khobragade remains in ministerial service but without a specific job.

The action comes a week after the mother-of-two spoke to NDTV about her arrest and strip search in New York.

During the interview, she said that her "kids were born in the US and are considered US citizens", a statement that reportedly took the ministry by surprise.

Ms Khobragade returned to India under a deal a month after her December 2013 arrest for allegedly paying a domestic worker a fraction of the minimum wage and for lying about the employee's salary in a visa application.

The row between the two countries saw weeks of feisty exchanges that strained bilateral ties and left resentment on both sides.