New Delhi - An industrial dispute over Tata Motors' acquisition of land in West Bengal for a factory to build the "Nano" - billed as the world's cheapest car - ended on Sunday. P

Protesters reached an agreement with local government on compensation to farmers whose cropland had been acquired for the plant, news reports said.

After three days of talks initiated by West Bengal Governor Gopal Gandhi, a grandson of Mahatma Gandhi, the two sides had reached "an acceptable formula," Communist Party of India-Marxist (CPI-M) leader Shyamal Chakraborty was quoted as saying by IANS news agency.

The CPI-M is the leading partner in West Bengal's left party coalition government.

The opposition Trinamool Congress-led forum of farmers, Maoist groups and some left parties had been holding demonstrations outside the Tata plant at Singur, about 40 kilometres north of Kolkata, since August 24 demanding that 400 acres of the 980 acres of land that had been acquired from farmers against their will should be returned.

After weeks of stand-off Tata Motors suspended work at the plant on Tuesday saying its workers felt threatened and had warned that it may relocate the project.

West Bengal Chief Minister Buddhadeb Bhattacharjee and Trinamool Congress chief Mamata Banerjee met for nearly two hours at the governor's residence on Sunday to cobble together the compromise under which farmers will receive alternative land and a committee will be set up to look into the land issue, Chakrabarty said.

The controversy over the Nano factory had led several other state governments to offer Tata Motors the option of moving the project to manufacture the 100,000-rupee (less than 2,500 dollars) small car to their regions.

The government of Sri Lanka also on Sunday invited Tata Motors to relocate the car project to that country. (dpa)