Protests halt work on Nano car plant in Singur

The interior of the Tata Motors' plant in Singur in West Bengal seen in this undated handout photograph. Work at a plant in Singur that will make the Nano, billed as the world's cheapest car, stopped on Friday after thousands of employees failed to turn up for work following protests by farmers, officials said.

KOLKATA (Reuters) - Work at a plant in West Bengal that will make the Nano, billed as the world's cheapest car, stopped on Friday after thousands of employees failed to turn up for work following protests by farmers, officials said.

Tata Motors, which is building the plant to launch the 100,000-rupees ($2,300) car, has faced violent protests and political opposition over the acquisition of farmland in Singur, an hour's drive from Kolkata.

More than 3,600 employees were escorted by police out of the Singur factory on Thursday after political activists and farmers threatened to assault them if they returned, officials said.

"Our workers are not working today," a spokesperson for Tata Motors said. "We are assessing the situation as of now."

Last week, Tata Motors Chairman Ratan Tata said he was prepared to move the plant from Singur if violence continued, despite having invested $350 million in the project.

Indian industry officials have defended the project.

"The Tatas pulling out of West Bengal would be unfortunate for India. Nano is seen as a world car and has drawn international acclaim," Sunil Mittal, chairman of the Bharti group, said in a statement.

Trouble began after the government took over 1,000 acres of farmland for the factory. The government offered compensation but some farmers refused it, demanding that at least 400 acres of land be given back to them.

The protests reflect a larger stand-off between industry in India and farmers unwilling to part with land in a country where two-thirds of the billion-plus population depend on agriculture.

Mamata Banerjee, leader of the opposition Trinamool Congress, which is spearheading the protests, has threatened to organise statewide demonstrations.

On Friday, thousands of Trinamool supporters blocked roads and shouted slogans against the government, bringing traffic to a complete halt in the heart of Kolkata.

Protesters marched across the city for an hour, waving party flags and holding placards that read: "Give Back the Land".

West Bengal Chief Minister Buddhadeb Bhattacharjee said he was ready for talks with farmers but could not return 400 acres of land, earmarked for ancillary units, because it would make the project unviable.

Tata Motors has since been flooded with offers from other states for the Nano plant.

Shares in Tata Motors touched a high of 444.10 rupees before ending 5.44 percent up at 440.35 rupees in the Mumbai market.

(Additional reporting by Tamajit Pain)