Tata Motors will move production of the world’s cheapest car from a new factory in India’s West Bengal state if violent protests by local farmers forced to sell their land continue, its chairperson warned on Friday.
In a blow to the country’s image as an emerging centre of manufacturing might, Ratan Tata told a press conference that demonstrations over the acquisition of farmland for the factory threatened to delay the launch of the Nano, scheduled for October.
”What has concerned us is the violence, the disruptions, that has led us to be concerned about the safety of our employees, our equipment and investment, and of the viability of the process,” he said in the state capital, Kolkata, on Friday.
”We need to protect our people. How would we [be able to] bring our managers and their families if they are going to get beaten? … If anybody is under the impression that, because we have made a large investment of 15-billion rupees ($341-million), we would not move, then they are wrong, because we would move to protect our people.”
The Nano, which will be sold for 100 000 rupees ($2 280), was designed to bring motoring to the masses. Although hailed by the world’s press this year, the Nano factory has become a symbol of the simmering confrontation between industry and farmers who are unwilling to part with land in a country where two-thirds of the population depends on agriculture.
In the case of Tata’s new car, more than 400 hectares of fertile fields in West Bengal’s Singur district were acquired by the state government to set up the Nano plant. The factory will be able to produce 250 000 cars a year. Thousands of farmers who once raised four crops a year have been evicted.
When the Guardian visited the site this year it found farmers had killed themselves after losing land, and a protester had discovered the body of his daughter inside the factory site, strangled and burned.
The heavy-handed actions have resulted in repeated clashes. This week a strike shut the factory and thousands marched, blocking access to the site.
Rebranding
The backlash is embarrassing for West Bengal’s communist government, which has been in power for more than three decades and saw the Nano project as vital to rebranding itself as a regime friendly to capitalism.
Some analysts say Tata may be using the threat to force the state government to face down the protests, something it has been noticeably reluctant to do since losing local elections.
Opposition parties demand the return of 161 hectares of land, which the company says is impossible.
”Tata say they have no Plan B. The factory is nearly complete and the money is spent in West Bengal. If they start again somewhere else it will take time and there will be a cost implication. However, Nano will be loss-making at this price so Tata may save some money in that way,” said Mahantesh Sabarad of Mumbai’s Centrum Broking.
Commentators say that, whatever the calculation, this is a ”huge blow” for West Bengal, long plagued by labour unrest.
”It’s disastrous. The real problem is the way that land was acquired — by government strong-arming people into selling their land,” said Gurcharan Das, a business columnist.
”I think the real question here is whether Indians want to remain starving peasants or part of an urban proletariat. My bet is the latter.”
Economists say that at the heart of the argument is the fact that land is one of India’s scarcest resources, and its acquisition is essential to balancing industrial growth with the needs of rural farmers.
The tensions signal an economic transformation that is likely to be as jarring as that in China, which has seen a number of ”peasant revolts” over land grabbed for new industries.
However, some say the Indian system will give rise to a ”negotiated industrialisation”.
”I think we are seeing local people having a say in the process. And sometimes projects are pulled. Just recently 11 dams were cancelled after local protests in Sikkim,” said Sunita Narain, head of Delhi’s Centre for Science and Environment.
”Industrialisation has been violent in other countries, but I think Indian democracy can accommodate it without the violence.” – guardian.co.uk