Back in 2011, the Indian Grand Prix was India’s shining moment after the near-fiasco 2010 Commonwealth Games. Close to one lac in audience, the Indian Grand Prix was an ultimate success. Fast-forward to 2013, a black cloud cast upon the supposedly bright future of the IGP.
Threatened by a Supreme Court Case and the murky truth that the curtain is closing on the Buddh International Circuit next season, the Indian Grand Prix is standing with one foot in its grave. The hiatus is to allow organizers to shift the race to an earlier berth so they don’t have to stage the race twice in six months. Looking at the bright side it will allow time for the local promoters and the government to sort out the question of whether the government decides to recognize Formula One as a sport, or, as it does now, as a form of entertainment.
Why the debate? It’s because being recognized as a sport allows for tax and duty exemptions and an easier visa process for journalists and team personnel. But Formula One’s current status flips the perks, making it subject to entertainment tax and not to mention the reams of paperwork that needs to be done months in advance. “Because we are not a government-backed sport, we are not even a government-recognized sport, we are classified as entertainment,” said Karun Chandhok, a former Indian Formula One driver who now does race commentary for the BBC. “And that is what has opened up this whole can of worms of tax issues.”
The status of the event is not even the real problem here. The challenge India faces is the well-reserved truth that once a circuit is wiped out of F1’s charts, it’s very difficult to get it back on again. Yes, fans of the race who earnestly shelled out cash to watch Vettel win (again), 2013 could well have been the last year you saw action at the Buddh International Circuit.
Now the question is, is all this drama really worth it? Is the Indian Grand Prix worth all this hype in India? If numbers speak for the game, then here is the blatant truth. The tickets for 2013 Grand Prix ranged between INR 1,500 – INR 21,000, the ticket for the costliest grandstand being 60 percent of the price two years ago. The number of fans that showed up for the race was about 60,000, which the organizers said was up to their expectations. But does that mean they have nothing to worry about? It is said that the number of people attending the race in the second year is always lower than the first. But if the number doesn’t rise in the third, the organizers have a lot to worry about.
From an investor point of view, the Indian Grand Prix does not give a very bright picture. Given the downward economy, there is more risk than return. Companies are thinking twice before putting their money behind the event because after the dust has settled and engines have cooled, the only question that is left to be answered is – Is the event raking in the moolah? The Buddh International Circuit is one of the few F1 racetracks in the world that is not backed by government money. Other than the initial investment and running costs, Jaypee Sports International has to pay the F1 management a license fee of about $40 million annually. The revenues from TV rights and track sponsorships go to the F1 management directly. So the organizers mainly rely on ticket sales. And that situation you’re already aware of – no sunny skies.
Speaking to F1 fans, this season had nothing exciting to look forward to. According to Virat Maheshwari, a self proclaimed die-hard F1 fan, there was nothing to look forward to this season. “Everyone knew who was going to win, and to be honest no one I knew was even watching it live or tweeting about it.”, says Virat. So everyone knew who the obvious winner was going to be, there was not as much excitement about the race as there was before, and you know that the event had died when no one was talking about it on Facebook. Seems like the $400 million dollar Indian circuit has lost its lustre.
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