Posted by: Miracle Studios | October 3, 2008

Tata Motors shifts Nano plant after land row

KOLKATA – Tata Motors Ltd will move the factory for its low-cost Nano car out of West Bengal after violent protests by farmers who lost landforced it to stop construction work last month, its chairman said on Friday.

“Taking all things into account, mainly the wellbeing of our employees, the safety of our contractors and in fact our vendors also, we’vetaken the very regretful decision to move the Nano project out of West Bengal,” Ratan Tata said.Tata made the announcement after meeting state Chief Minister Buddhadeb Bhattacharjee in Kolkata.Tata Motors, the country’s top vehicle maker, had already started looking for other locations at which to build the Nano. It has said it hoped to launch the car this month.

“We will have to make the best of the deadline that we have,” Tata said. “We are going to do everything possible to come close to the deadline we had established.”

Tata said the firm had not made a decision yet on where the Nano factory would be relocated, but was examining offers from three or four states.

“We hope we would be able to find a location that has a congenial environment,” he said. “All these issues we will announce in the next fewdays when we have a clearer picture.”

The Nano is expected to be priced at just above 100,000 rupees, and has been billed as the world’s cheapest.The company, the third-biggest carmaker in India, had planned to make 250,000 cars at the Singur plant in West Bengal initially, increasing capacity to 350,000 units.Work at the plant was nearly complete when farmers, backed by the state’s main opposition party, stepped up protests, saying they were forcedoff their land without adequate compensation.

The dispute, which came on the heels of similar protests in other states, reflects a larger standoff between industry and farmers unwilling to surrender land in a country where two-thirds of the population depends on agriculture for a living. Cost overruns caused by delays at Singur, where Tata Motors had invested about $350 million, had already raised the cost of production of the Nano, which was unveiled to a rousing reception in January and sent rivals scrambling for their own plans.

Eventual demand for the Nano was expected to be about one million units, Tata has said.

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