Fire brigade officials said the fire started in a structure that was added to the pump room of Shoeb Manzil building and was being used as the residence of the building's watchman.
Electrical wires and household articles in the makeshift structure fuelled the fire, officials said, resulting in choking fumes.
"A girl, about one-and-half-year-old, was rushed to the Holy Family hospital due to suffocation caused by the fumes but was declared dead on arrival. Another child is currently in the hospital's Intensive Care Unit," a fire brigade official said.
Investigations into the cause of the fire are currently underway, an official said, adding that using the pump room for residential purposes was illegal and fire officials have been told to file a police complaint.
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