Speed money: Formula 1 circus drives real estate scam in Noida that’s bigger than 2G and CWG
The race for land acquisition in Noida is gaining pace. Apart from a pretty racetrack, there will be a lot of commercial and residential property, maybe even an international airport, and more, all a short distance from Delhi
Motorsports has never been for those without deep pockets. Globally. However, for those who could not afford the thrill of being behind the wheels, there was always the option of sharing in the excitement by being part of the organisers.
Marshalls, safety officials, service teams, and all the rest of it-you got up-close to the action, you had access to the stars, and at the end of the day you even had somebody picking up your expenses, you were invited to the best parties, and if you were lucky then maybe an honorarium came your way too.
All this has changed. Leave alone the even deeper pockets needed to get behind the wheel, most support and organisational positions are also up for auction, barring the extremely highly technically designated ones. Pit crew positions, supposedly the holiest of all holies, as also those for the cheesecake on display, for example, are also eminently buyable: The guy who waves the stop/go signboard, or the girl who trots past suitably bared, often pay for the privilege of getting their mugs and more on the screen.
In the midst of all this, India's domestic motorsport scene has been trundling along, carried forward by a band of enthusiasts, who seemingly do not get tired despite the lack of serious sponsorships. Frankly, there are very few new faces; one sees the same lot going back 20-30 years, in charge. Whether it is the growing rally circuit all over the country, the rather static motor racing crowd at Sholavaram near Chennai, or the wavering go-kart races, the sport seems to, still, be running on its own steam with moderate to low support from the government.
Till the Formula-1 circus hit the horizon. And till whispers reached my ears-'do you want to volunteer for the Formula-1 season, which by the way is likely delayed by two months to December 2011, ostensibly because of Bahrain, but more likely because the progress on the circuit is way behind schedule. Oh yes, there is interest. But it now appears that one has to pay to be a volunteer. However, there is an 'encouragement fee' in case you get more volunteers! Does anybody smell another scam here?
But that's chicken feed compared to the real big one. The big one is probably as big, if not bigger than the Commonwealth Games (CWG) and the Indian Olympic Association (IOA) scams put together.
What we now have, on the Indian side of the horizon, is a 'circuit'. Named "Buddh International Circuit", it extends from one end of Noida, to way beyond Greater Noida, in its reach and control, with the racetrack being just one nodal component for what appears to be a land acquisition rampage of huge proportions. Fair enough, development cannot be stopped, land use shall be changed-that is how it is. The present agitation will eventually resolve itself-that is also a given. And apart from a pretty racetrack, we will see a lot of commercial property, residential property, industrial property, maybe even an international airport, and more, coming up, all within easy striking distance of Delhi. Even the sand being taken out has immense value; marshland and nature be damned.
But that's realty for you in India. Real estate corruption in India is a bigger ticket than the 2G scam, CWG scam and other scams that currently occupy mind space. Not as big as the mining scam, but certainly not too far from the defence scam, aviation scam and sea-cargo related scams-so these will take time to unravel. All these scams have a domestic side, which can be called "corruption" and a global side, which can be called "asset theft".
But what we have on the global side of the potential here at Formula 1, just as we did in the Commonwealth Games, is something else.
To start with, just like the Commonwealth Games, the whole Formula 1 concept appears to be, to put it mildy, in danger of winding down like an old grandfather's clock that has not been wound for some time. The undisputed boss, Bernie Ecclestone, is now 80, and is reported to have a history which is as colourful, if not more, than that of Dominique Strauss-Kahn, the ex-chief of the International Monetary Fund, now in a new disposition. For example, the television audience for Formula 1 is dropping, by as much as 35%, in England itself. (The stands don't really make that much money.) The private equity firm, CVC Capital, that now owns Formula 1, is reported to be accepting offers, and the only bid they have received is from a consortium composed of News Corp and Exor, the people who indirectly own Ferrari, which makes it a sort of one-automobile, one-television channel kind of in-house game. Think about pay-TV and only Ferraris.
That aside, the books at Formula 1 survive on very high 'hosting fees', paid by governments keen to see this event in their country. Close followers would have observed how stands are often empty. Some of these hosting fees, no doubt, are shared, especially where governments are corrupt. Viewed in a very simple businesslike manner, this is like the Indian government paying a foreign steel manufacturer to lift iron ore from India (which, amazingly, in a way is what is also happening, but that is a different report), and then also paying for everything else on the ground in India to assist, including paying for and putting up the infrastructure to do so. Imagine this, also, as leaving your house open for thieves, but also providing them with a car and keys to drive away, as well as a certificate declaring their provenance.
And to do all this, loans are organised, through Indian banks. Suitably hand-held by foreign banks, of course, so that tax-haven secrecy fundamentals can be brought into the picture, thereby providing our finance minister with an opportunity to look helpless. Again, the current number, in total, for the Formula 1 races is supposed to be in the region of (hold your breath) Rs700 crore to Rs800 crore as loans, grants and sanctioned expenses, on various accounts. This does not include the cost overrun as well as hosting fees.
These hosting fees are not small, they run into hundreds of millions of dollars, and are on an escalating scale, going up every year, regardless of anything else. To illustrate the size, France, which was the home of Formula 1, and where the first Formula 1 Grand Prix was ever held, has withdrawn simply because the hosting fees became too much for the organisers and the country to bear. (Local jokes refer to it now as Formula Zero, which when said in French is another colloquial joke altogether.) And France is one of the few developed countries where TV viewership is still going up.
What are the hosting fees India is paying, one way or the other, and who is paying it? There are no answers. Driving towards the work sites, one is not permitted beyond the outer perimeters, and the local motorsports bodies are not exactly forthcoming either. The official Formula 1 website does not say much about the India event. The Indian organisers and co-ordinators are, again, opaque.
The fact remains, that somehow, somewhere, some money from the taxes we pay are going towards this jamboree. And we have no idea how, who, or how much.
Technically, motorsports in India, like other sports, comes under the Ministry of Sports. That means, broadly, the Motorsports Association of India (MAI) and the Federation of Motorsports Clubs of India (FMSCI). There is a clear judgement out on this; they need to be under the Right to Information Act of India, 2005. However, their websites do not show any adherences, and are absolutely silent on the numbers as everything else. Their 'leaders' have been the same for decades-Nazir Hoosein since the '60s and Vijay Mallya thereafter.
At the same time, like the CWG or IOA, they are supposed to come under international bodies, in this case the Fédération Internationale de l'Automobile (FIA), which is what MAI comes under. Trouble is, FMSCI owes its allegiance to the IOA. So, now begins the game of recognised, not recognised and affiliated, unaffiliated, so on and so forth, round and round, like an F 1 race. MAI and FMSCI, as well as splinter groups which form, merge, divide again, have been at it for so long that within the motorsports world in India, most people don't really know what is going on.
In the midst of all this comes this big lollipop, the Formula 1 race, which offers multiple benefits to everybody. So differences simmer, but are brushed under the carpet, for now. In the interim, the real big game carries on, and only one small part is this business of 'paying volunteers', which is where this article started from.
The real big part, as always, has to do with the way the mammaries of the State are going to be sucked dry again - in every possible way. Bernie Ecclestone, the boss of Formula-1, is already under investigation in Germany for bribery - wherein a bribe was paid to an executive at Bayerische Landesbank to pick up a stake in Formula 1. And now we invite the same entities, to sell us the same old snake-oil, which we will pay for?
Nobody is really talking about the numbers behind Formula 1 in India. The truth is that if people ask questions, like the farmers who own the land nearby did, the state uses the might at its disposal and sends in its police to shut them up. Something like what they tried to do with the Commonwealth Games, not too long ago, and see where it got the organisers?
(Veeresh Malik used to take part in motorsports, but withdrew in disgust over the politics in the game. MAI and FMSCI do not adhere to the RTI Act. Questions addressed to some people involved in organising the Formula 1 event are met with wry grins, and not much else. The media is kept totally out, barring guided tours for elements within the already compromised motoring media.)