AP
Tata group chairman Ratan Tata smiles as he addresses a press conference in Calcutta, India, Friday. Tata on Friday threatened to move an important auto factory out of India's West Bengal state due to violent farmer protests and strong political opposition, a move which would presumably delay the debut of the world's cheapest car.

NEW DELHI (AP):

The chairman of the Tata Group threatened Friday to move an important auto factory out of India's West Bengal state because of violent farmer protests and strong political opposition, a move that could delay the debut of the world's cheapest car.

The pint-sized Nano, priced at US$2,500, was scheduled to go on sale by the end of the year, but if Tata pulls the Nano factory out of West Bengal, the much-anticipated car would almost certainly be delayed.

Tata made international headlines when it announced the Nano's bargain-basement price and unveiled prototypes in January.

But the plant has sparked protests by displaced farmers who say they haven't received proper compensation and opposition politicians who accuse the company of taking advantage of the rural poor.

Company chairman Ratan Tata said he was prepared to leave West Bengal if the protests continue.

"If the state for any reason ... feels that we are exploiting them, if that is the feeling, we will exit," Tata told reporters Friday in Calcutta.

"We can't operate the plant with police protection," he said, adding that protesters have attacked Tata employees and stolen equipment from the factory site.

Tata did not say when he would decide whether to leave the state, and he did not address how the move would affect production of the Nano.

National debate

West Bengal has been the centre of a national debate about acquiring farmland for factories in India, where about two-thirds of the more than one billion people live off agriculture.

The controversy came to a head last year when police gunned down 14 protesters in Nandigram, a nearby district in West Bengal, causing an outcry that eventually scuttled a planned special economic zone designed to draw foreign investment.

Tata has the support of the communist government that has ruled West Bengal for three decades, but a coalition of opposition parties has strongly fought the project because it opposes using fertile farmland for industry.

Tata has also had to fend off angry farmers who claim not to have received proper compensation for the 997 acres (405 hectares) Tata acquired in Singur, a village 20 miles (30 kilometers) northwest of Calcutta.

Mamta Banjeree, chief of the opposition Trinamool Congress party, which has led the fight against Tata, called Friday for the company to return 400 acres to the farmers.

Tata Group, founded in 1868, is one of India's largest business conglomerates, with interests spanning steel, software services, hotels, chemicals and insurance.