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India grapples with F1 hosting logistics

India is banking on its hosting of a Formula One Grand Prix to be a boon for tourism, yet hotel shortages and airline price increases may cause headaches for fans intent on travelling to the sport's newest frontier.

india Updated: Oct 14, 2011 17:47 IST

India is banking on its hosting of a Formula One Grand Prix to be a boon for tourism, yet hotel shortages and airline price increases may cause headaches for fans intent on travelling to the sport's newest frontier.

The Buddh International Circuit was given a clearance by top F1 bosses last month, with FIA race director Charlie Whiting recommending only minor alterations to the 5.14-kilometer track ahead of the inaugural race on Oct. 30.

With the track seemingly in order, attention has turned to the logistics of hosting sport's biggest travelling circus and tens of thousands of visiting fans.

The location of the track is problematical, as Greater Noida, 40 kilometers from New Delhi, is a new suburb with only a handful of decent hotels. Those in the adjoining area of Noida are full for the period and a long commute through the dense traffic from New Delhi is the only option left.

"There has been a great surge for room bookings in that area," said Rajneesh Malhotra, executive director of Bestech Hospitalities Private Ltd which runs the 88-room Park Plaza hotel in Noida.

"October anyway is a good month for hotels and with F1 taking place during this period the demand for rooms has shot up. During the Grand Prix, hotels are selling their rooms for around 50-80 per cent higher than the month average," Malhotra told The Associated Press.

Rooms with a tariff of around 6,000 rupees ($130) have generally gone for 9,000 rupees ($200) or more and it has also resulted in super luxury suites priced at around 40,000 rupees ($950) being booked well in advance.

"While Indian media reports saying rooms have gone for 10 times their tariff are not true, the fact is that the 2-3 exorbitant presidential or luxury suits in a hotel that are generally not in demand, have been taken during this period," Malhotra said.

Greater Noida and Noida boast of just over a dozen hotels with a rating of three stars and above and it is no surprise that rooms have been sold out.

Vikas Suda, director of New Delhi-based travel company VDOIT4U, told AP that he usually booked hotels in Greater Noida only for residential conferences, but this year has been different.

"We are holding about 18 rooms in prominent hotels of the area," Suda said. "Our clients gave us the queries well in advance and we were able to manage good rates for them."

But Suda said he has to now resort to booking rooms at hotels in New Delhi.

"We are left with no option but to look at New Delhi hotels as there is no way we can manage more rooms in Greater Noida or the adjoining area of Noida," Suda said.

"Airfares too have seen a surge upward of at least 25 per cent from different Indian cities with those from Mumbai doubling from the normal average of 7,000 rupees ($155) to 14,000 rupees ($ 310).

"Flight rates have gone through the roof, but most of those bookings are generally being done by my clients on the internet since the first thing they want in place is the air bookings," said Suda, who plans to launch special F1 packages next year.

"We are waiting for the next Grand Prix, to design and launch packages which can be promoted not only in India but abroad too. We definitely see a market there and a package deal would be welcome for lovers of F1," Suda said.

Private enterprise Jaypee Group has invested $ 215 million at the venue and procured 10-year rights for the Indian F1 race but other investors may take time before taking a plunge.

"I would not like to speculate on investments in the hospitality sector, but it will be safe to say that events like these would definitely enhance the perception of the area in general and many businesses including hotels will benefit," Malhotra said.

Suda felt a lot would depend on the success of the first edition and it could make up for the negative publicity during last year's Commonwealth Games which were marked by construction delays and corruption allegations.

"A lot of foreign enthusiasts are waiting for the success of the first Grand Prix. I am sure once we are able to pull it off, there would be a lot of high-end clients making a beeline for the next one," Suda said.

Vijay Thakur, chief of the Indian Association of Tour Operators, said the success of F1 in India is not guaranteed.
"F1 is bound to generate a lot of international interest, but it depends on how it is marketed. Otherwise, our expectations may not be met," Thakur was quoted as saying by Business Standard newspaper.