Indian Grand Prix still on track, says Mallya

Chairman and Chief Executive Officer of Kingfisher Airlines Ltd. Vijay Mallya speaks during a news conference in New Delhi in this May 7, 2007 file photo.

SPA-FRANCORCHAMPS, Belgium (Reuters) - India's hopes of hosting a Formula One Grand Prix in 2011 are on track despite exchange control obstacles, according to Force India team owner Vijay Mallya.

In January, the Indian sports ministry rejected a request by race promoters JPSK Sports to remit $36.5 million in foreign currency to Bernie Ecclestone's British-based Formula One Administration (FOA).

Local media last week quoted the ministry as saying that hosting a grand prix would not further the development of sport in the country.

"The Indian Grand Prix for 2011 is on track," Mallya told Reuters at the Belgian Grand Prix, where Italian Giancarlo Fisichella handed his team a stunning first pole position on Saturday.

"The promoters of the event have acquired land and spent a fairly significant sum of money in getting the track built, together with surrounding infrastructure," Mallya added.

"I think the recent media reports of the government of India ministry of sports not supporting the event is limited only to permission that the promoters sought to remit about $38 million to FOA, because we still have exchange controls in India.

"They ran into some difficulty with that. But in this entire environment of exchange control in India, this is not surprising at all.

"Maybe they just have to go back to the ministry of sports and give some better explanation. At the end of the day, its a lot of Indian rupees and so a typical government officer would not just readily sign off."

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Mallya said the future of his own team was secure, despite regular speculation in the grand prix paddock that he might be looking to sell due to financial pressures on his business empire.

"I don't know where these rumours are coming from about the team," he said. "The team's alright, the team is in good shape and we are improving with every race as you can see. I didn't get into it to get out of it."

Mallya, whose United Spirits is the world's third largest spirits maker, said his core liquor business was performing well.

"The airline industry is under pressure, but not only in India," he told reporters.

"My finances do not depend on the airline and neither do Force India's finances depend on the performance of any of my companies. Force India is securely funded and I am committed to stay here as everybody knows."