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SINGUR, India: Efforts to resume construction of a factory to build the world's cheapest car were stuck in neutral Tuesday, as India's Tata Motors raised doubts over a deal to end violent protests at the plant.
The Marxist government in West Bengal state had announced Sunday an agreement to halt the demonstrations over farmland seized to build the Nano car factory.
But India's top vehicle maker refused to resume construction immediately, arguing that the accord lacked clarity and asking for firm pledges that it would be allowed to operate smoothly.
A four-man committee set up by the state government to resolve the dispute met for the first time Tuesday in a bid to keep the deal alive.
State industry minister Nirupam Sen said the talks had ended on a "positive note" and added that the committee members would visit the site of the plant on Wednesday.
Tata Group chairman Ratan Tata warned last month he would abandon the plant unless his workers' safety could be assured, even though the company has already poured 350 million dollars into the project.
The deal announced on Sunday, which followed three days of talks between the protesters and the state government in Kolkata, included a pledge to return some of the land earmarked for the factory's ancillary units.
Tata has insisted on protecting the integral nature of the plant, arguing that any move to shift the units - mainly automotive part vendors - from the existing site would affect the tightly managed supply chain and drive up costs.
In a letter delivered on Tuesday, Tata Motors managing director Ravi Kant noted "clarifications" by the state government that such protection would be forthcoming.
"We would like to be told also about any future understanding, commitment or agreement which may go contrary to this arrangement," Kant wrote.
The Nano, targeting millions of Indian first-time car buyers, is slated to retail at just 100,000 rupees (2,260 dollars).
Protests against the plant have been going on for two years, but demonstrators had upped the ante in recent weeks, besieging the factory and threatening to kill workers.
Opposition has been spearheaded by West Bengal's Trinamool Congress party, which had been pushing for land appropriated for the plant to be returned to evicted farmers.
The plant in Singur on the outskirts of Kolkata is 90 percent complete, and Tata Motors, part of the tea-to-steel Tata Group, has said it aims to launch the Nano in October, in time for the big-spending annual Hindu festival season.
All work on the factory was halted over a week ago when protesters barred workers from entering the plant.
The West Bengal government had wooed Tata Motors to set up the plant in Singur, hoping it would lead the way for the state's industrial resurgence and create jobs.
Scrapping the plant would hit Tata Motors' finances, already under pressure from its 2.3-billion-dollar acquisition of British motoring icons Jaguar and Land Rover earlier this year, and from slowing domestic vehicle sales.
The dispute reflects a wider conflict between farmers and industry over land rights across the nation.
On one side are many farmers who say they will starve without their land, while business and government say India must industrialise to create jobs for its army of young people.
- AFP/yt
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