Inability to hold race in Mar pushes India off F1 '14 map

Formula One boss Bernie Ecclestone has announced that it was not possible to accommodate the Indian F1 circuit in the racing calendar in 2014 after its Indian partner Jaypee Sports said that the Indian Grand Prix for 2013 would be held in October instead March, reports CNBC-TV18.

The Formula One management committee clarified that the request to drop the F1 race in India was made by the Jaypee Group. Sameer Gaur, CEO and MD, Jaypee Sports told CNBC-TV18 that the decision was not based only on participation but also on the receipt of certain clearances. "We have a 5-year contract with Formula 1 and will organize 5 races. We have invested USD 400 million on the track and we will organize other races on the track in 2014. The last F1 race will be in 2016 and there is no reason for any compensation for not having a race in 2014. I don't see real estate plans near the F1 track taking a hit due to this," explained Gaur.                      Below is the verbatim transcript of his interview to CNBC-TV18 Q: Earlier it was reported that it was actually the Formula One Management Committee (FOMC) and Bernie Ecclestone that had decided to drop plans for the Indian Grand Prix on account of political reasons and whole bunch of other stuff. But now it seems that it was actually the Jaypee Sports, the promoter, you guys decided that it was best that the Indian Grand Prix not take place in 2014? A: The earlier statement was also from Formula 1. The calendar is always decided by Formula One Management (FOM) and when Formula 1 came up with the idea that the 2014 Grand Prix has to happen in March and April, we sat with them. We discussed because it is not only about participation it is about so many clearances, which are required. We have to pay upfront custom duty which then is refunded back to us, which is a process which has to be taken. November end, December end, January first week, till January 10, there are holidays in Europe. So, we need certain approvals and from there then we have to again go back to the authorities. So, there are a whole lot of things which need to happen and then they didn’t want to do a Grand Prix in 2014, October and the best weather and the best timing either it is in March-April or after October till November. So, I think it would be better then to have a Grand Prix in 2015. Q: When these reports surfaced last week and a spokesperson of yours was specifically asked they said that they were unaware of a decision that had been taken. But clearly you are saying a decision had been taken, a decision had been arrived at after a conversation and in consultation with both parties. So why was it that Jaypee didn’t come out and clarify earlier that the decision to drop the 2014 race had already been taken? A: I think it was at the Hungarian Grand Prix when Mr. Ecclestone gave a comment that the Indian Grand Prix in 2014, is not going to be there. All this whether it is going to happen in 2014 or not, whether March or October was all being discussed. However, now we have had this. We have a five-year contract with Formula 1 and god willing we are going to have five year races in India. But 2014, it is not going to be there, it is going to be 2015. Q: Since, the race is not going to happen in 2014, what is this actually going to mean in terms of a revenue hit for you? A: We have already done investment of more than USD 400 million on the track and to survive at the track there are lots of many other things which needs to be done apart from Formula 1. So, we will have other races in 2014, which are being discussed. Q: So, 2015 is when your contract runs out with Formula 1 management. Are you now worried that given the fact that 2014, there is going to be no Indian Grand Prix, we are unlikely to see a race take place in 2015 as well and how are you protected if the contract actually expires before it is meant to? A: No, we have got a signed contract in which we are entitled for five races and we will have five races except for 2014. So, now instead of 2014, the race is going to be after 2016. Q: That decision is being taken your contract will now extend to 2016? A: Yes that decision is already there. We have five races, so instead of 2014, we will have the race in 2016. So, 2015-2016-2017 will be five races. Q: Is there any compensation that either you will need to pay to the Formula 1 management or they need to make to you because you haven’t been able to sort out the racing schedule? A: No, I don’t think so that there is no reason for any compensation. We have already done our bit by making the circuit and by hosting the race as a private entrepreneur with the Jaypee Group, so there is no compensation for this. Q: We have seen the Jaypee Group’s stocks taking a beating in the market after this news actually broke and now you are confirming that there will be no Indian Grand Prix in 2014, you have got significant real estate plans around the Formula 1 City and around the Formula 1 circuit. Are you worried now that some of those plans are also going to come undone? A: Our real estate is doing well and it will keep on doing well. The financials and everything is fine. So, I don’t think that this race itself is going to be a reason for a hit.