Tata Motors has suspended construction and commissioning work at its new Nano plant in Singur “in view of continued confrontation and agitation at the site”.
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The company had faced five continuous days of cancellation of work in the face of increasingly violent protests over the seizure of land for the plant from local farmers.
“This decision was taken in order to ensure the safety of its employees and contract labour, who have continued to be violently obstructed from reporting to work,” Tata said in a statement.
“The company has assessed the prevailing situation in Singur, after five continuous days of cancellation of work, and believes that there is no change in the volatile situation around the plant.
“The project’s auto ancillary [supplier] partners, who had commenced work at their respective plants in Singur, were also constrained to suspend work in line with Tata Motors’ decision.”
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By GlobalDataTata said it was evaluating alternate options for manufacturing the Nano at other company facilities and a detailed plan to relocate the plant and machinery to an alternate site is now being prepared.
“To minimise the impact this may have on the recently recruited and trained people from West Bengal, the company is exploring the possibility of absorbing them at its other plant locations,” Tata said.
Tata said there had been a “continual decline” in the attendance of staff and contractual labour since 24 August while some of the international consultants working on the plant had even returned home. Construction work had been stalled since 28 August.
“In fact, the existing environment of obstruction, intimidation and confrontation has begun to impact the ability of the company to convince several of its experienced managers to relocate and work in the plant,” Tata said.
“Further, several persons engaged in the construction and commissioning work who had taken accommodation at Singur and nearby areas have since vacated and have gone away due to intimidation and fear.”
Construction of the Nano assembly plant and vendor park began in January 2007 and had been on schedule, employing about 4,000 at its peak.
As part of the proposed integrated auto cluster in Singur, about 60 key suppliers had taken possession of land in the integrated complex and invested in plant construction and equipment and machinery purchases.
The August protests which became violent were organised by supporters of India’s ruling Congress party, which opposes the communist state government.
The central issue was a battle between local people protesting the seizure of farm land for the plant and the state which allocated the land to the automaker.
The protest reflected a larger ongoing dispute between Indian industry and farmers unwilling to part with land in a country where two-thirds of the billion-plus population depends on agriculture.
A Tata Motors spokesman said: “The situation around the Nano plant continues to be hostile and intimidating. There is no way this plant could operate efficiently unless the environment became congenial and supportive of the project.
We came to West Bengal hoping we could add value, prosperity and create job opportunities in the communities in the state.”
Local reports said Tata was expected to stick to its schedule of launching the Nano shortly, from its existing Uttarakhand plant, while several states have made offers of land.
The statement ended speculation since Tata group chairman Ratan Tata said in Kolkata on 22 August that the company would not hesitate to pull out of Singur despite the investments in the plant.
The reports added that Trinamool Congress leader Mamata Banerjee had been agitating against the project, demanding that 400 acres of the 1,000 acres acquired for the project be returned to the owners, while West Bengal governor Gopalkrishna Gandhi tried to find a solution to the deadlock.
