South Asia

Tata Motors contests factory land return

Farmer outside Nano factory in Singur
Image caption Land acquisition is becoming a major political issue in India

Indian carmaker Tata Motors has challenged the government of West Bengal over measures it has taken to reclaim land which the company had acquired for a car factory.

The land in Singur, near Calcutta, was acquired by the state's former communist government in 2006 for Tata Motors to make its low-cost Nano car.

After months of violent protests, the company pulled out of West Bengal.

Tata Motors then went on to set up a new plant in the state of Gujarat.

In May, the regional Trinamul Congress party led by Mamata Banerjee won a landslide victory in West Bengal against the state's long-serving communist government, on the promise that she would restore the land to the farmers.

Earlier this month, West Bengal passed a law that would allow for the return of about 400 acres of land to farmers who never accepted government compensation for their land.

Some legislators have criticised the law, saying it was introduced in haste. Others have demanded that the entire 997 acres of land taken for the project should be restored.

Tata Motors spokesman Debasis Ray said that the company was contesting the decision in the high court in Calcutta.

Tata Motors has reported a tripling of profits in the last year.

However, sales of small cars lagged somewhat in the last year, perhaps reflecting difficulties with the Nano, which began production in 2008.

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