Sources said Walia was initially reluctant to contest from New Delhi but agreed later following the party's direction.
Kejriwal had defeated Dikshit by a huge margin of over 25,000 votes in the New Delhi seat. BJP is yet to announce its candidate for the seat.
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She was defeated by AAP's Somnath Bharti in Malviya Nagar constituency in the 2013 Assembly polls. She had won the seat in 1999, 2003 and 2008.
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