India: Last-ditch talks on Tata factory for Nano

By Joe Leahy in Singur, West Bengal. Published: September 3 2008 18:00 | Last updated: September 3 2008 18:00 The government and opposition of West Bengal are set to hold an emergency meeting in a last-ditch attempt to rescue a plan to make the state the manufacturing hub for the world’s cheapest car, the Tata Nano. Gopal Krishna Gandhi, West Bengal’s governor, said he would chair a meeting between the state’s communist rulers and its main opposition party, the Trinamool Congress, which claims farmers were forcibly evicted to make way for the Nano’s factory in Singur, near Calcutta. The Trinamool Congress has besieged the site of the plant with thousands of protesters, leading the Tata group to warn it would relocate the project to another state unless the stalemate was ended and its workers allowed unhindered access to the area. “During this period it is essential that all aides try to maintain and encourage calm in the Singur area and take steps to build a mutual confidence that is essential for the discussion to take place and succeed,” the governor said in a statement. The Tata group sent its strongest signal yet that it might pull out of the West Bengal state, saying thousands of protesters were “violently obstructing” the construction of the factory for the project. Tata Motors said it was suspending construction work at the site of the plant in Singur, which has been besieged for the past two weeks by the Trinamool Congress. The party is calling for the return of 40 per cent of the 1,000-acre site to farmers it says were forced off their land by the project. The Tata group’s threat marks a sharp escalation in its efforts to force West Bengal’s communist government and the Congress to resolve an impasse over the project, in which the Tata group has invested about Rs15bn ($341m). With a price tag as low as Rs100,000, the Nano was due for commercial release next month, but any move to relocate it to another state could delay full-scale production by at least a year, analysts say. Mr Gandhi said he would merely be a chairperson for the meeting and not a “third-party mediator”, hinting at the politically difficult nature of the meeting. He will be advised by Justice Chittotosh Mukherjee, a former chief justice of the Bombay high court. A senior government official told the Financial Times the state was likely to offer farmers a package of additional benefits and possibly more compensation for their land. There was no possibility, however, of returning any land to them or giving them alternative land elsewhere, he said.

The father of two laborers at Tata Motors' troubled small car factory in eastern India killed himself Wednesday, local police said, a day after the company suspended work indefinitely at the site. The Tata factory halted work on the much-anticipated Nano, which has been billed the world's cheapest car, because of increasingly violent protests by farmers demanding the return of some of the land on which the plant was built. Sushen Santra, 65, was largely supported by his two sons who worked at the Tata factory in Singur in West Bengal state. The men had not been paid since work was suspended Friday, according to the Press Trust of India news agency. Santra, a farmer, swallowed pesticide in his village just outside the plant and died in a Singur hospital Wednesday, said police official Priyabrata Bakshi. It was unclear why Santra killed himself, and police declined to speculate. Tata has poured US$350 million into its factory in Singur. About 60 key suppliers have invested millions of dollars more for plants and equipment in the area. Tata officials have said they are exploring whether Nano production could be relocated to the company's other six factories scattered across India in an effort to meet production deadlines. The company has trained over 762 workers in West Bengal and says it is considering sending those employees to its other plants. It was not clear whether Santra's sons would qualify to be relocated. Tata has pledged to launch the Nano by the end of the year, but moving the factory would almost certainly delay the car's debut. State officials who supported the project have expressed dismay at the developments, saying they will discourage investment in India. On Wednesday software professionals in Calcutta, the state's capital, marched with black cloths tied around their mouths, waving signs that read, «We want industry,» and «Yes to Tata. In Singur, Tata supporters clashed with workers from the Trinamool Congress, the party that opposed the project, but there were no reported injuries.