The Congress government seems poised to drop the bid for Formula One racing track for Hyderabad.

Chief Minister Dr Y S Rajasekhar Reddy hinted at this when he told the State Assembly on Saturday that "It is not a priority for my government. A state like ours does not need a project that requires a massive outlay of Rs 1,000 crore."

Formula One racetrack for Hyderabad was a pet project of former Chief Minister N Chandrababu Naidu. Naidu was wooing the Formula One promoters and the state officials had held several rounds of discussions for setting up the racetrack on the outskirts of Hyderabad.

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"The previous (Telugu Desam) government wanted to spend Rs 1,000 crore over seven years to hold the Formula One race for seven days a year. We are not in a position to spend on such projects and we will definitely review them before taking a final decision," YSR said.

Dismissing the former chief minister's fancy for Formula One contemptuously, YSR said, "Our government is interested in irrigation projects rather than Formula One races. We can consider such projects when the coffers overflow and people become rich, fat, have filled-up tummies and suffer from indigestion."

It may be recalled that the previous government had held several rounds of talks with the promoters of Formula One and claimed that Hyderabad was at the forefront of other Indian cities for a new racetrack. Maharashtra and Karnataka were the other states wooing Formula One bosses to locate the Indian track there. The governments of these states had also promised to provide hefty subsidies for the project.

Naidu was keen that Andhra Pradesh should not "miss out in this race for Formula One track." The state administration, during his tenure, had assured to provide the land for the project, besides the other subsidies and incentives required in cash and kind.

The former CM had claimed that Formula One project would bring in a lot of economic benefits and accelerate developmental activities in the area. "Formula One is the second most favourite sport among the youth. A Grand Prix event requires 700 flights to bring spectators and participants. About 200 jumbo jets are required to ferry the equipment for the race," Naidu used to point out. 

Initial discussions between AP government and Formula One promoter Bernie Ecclestone and other officials were held when Naidu was in Italy to witness the Grand Prix at Monza in September last year.  Formula One already has 17 venues and Hyderabad, if chosen by the promoters, would have been the 18th venue.

The Formula One racetrack and allied infrastructure and facilities required 1,300 acres of land on the outskirts of Hyderabad. The cost for setting up the racetrack alone was estimated at Rs 600 crore. The project was expected to create 20,000 jobs directly and 50,000 jobs indirectly.

Naidu claimed that Formula One project would generate lot of investment and would give a boost to hotel, tourism, entertainment industry and business. The government would also get more revenues and the area in and around Hyderabad would be transformed.

The government officials estimated that about 3,000 hotel rooms would be required for the organizers and participants of Formula One race and another 7,000 to 8,000 rooms to accommodate the visitors who would come to witness the race.