"The news is quite positive," the drinks and aviation billionaire, who is also chairman of the Motorsports Association of India (MAI), told a news conference at the German Grand Prix.

"I happened to be having lunch with the CEO of one of India's biggest banks and he confirmed that they had sanctioned a facility to the developer of the Indian track," he added.

"He has actually bought the land and on October 1 construction of a brand new track will begin.

"So for the first time now I think I feel very confident to be able to say to you that there will be a brand new track and that we will have our first Grand Prix in 2010. It's just outside New Delhi," said Mallya.

Indian Olympic Association (IOA) president Suresh Kalmadi announced last September that Formula One Management had approved two sites on the outskirts of New Delhi with the IOA to make the final choice.

The Hindustan Times reported in November that JP Associates had signed a 10-year contract to develop a site at Greater Noida, 50km to the east of the capital.