New Delhi - India's Tata Motors announced Friday that it was scrapping plans to manufacture the world's cheapest car, the Nano, in the eastern India state of West Bengal because of continuing protests over farmland acquired for its plant.

Tata group chairman Ratan Tata told reporters in the state capital Kolkata that the company feared for the well-being and safety of its employees.

"You cannot run a plant with police protection ... You cannot run a plant when bombs are being thrown inside the plant ... You cannot run a plant when workers are being intimidated and threatened," he said after meeting with West Bengal Chief Minister Buddhadeb Bhattacharjee.

"This is a decision we have taken with a great deal of sadness ... There was little choice but to move out," Tata said, blaming the state's opposition Trinamool Congress party, which has led farmers' protests.

The Trinamool Congress-led forum of farmers, Maoist groups and some left parties have 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.

In early September, Tata Motors suspended work at the plant because of the protests, saying its employees felt threatened and later warned that it might relocate the project to another state.

"To the best of my knowledge, the land was acquired legally ... it was done transparently and the compensation was based fairly," Tata said.

The Nano, dubbed the "People's Car," costs around 100,000 rupees (2,130 dollars) and was unveiled with much fanfare at a car show in New Delhi in January

Tata officials said the company hopes to launch series production from its existing plants in other states. (dpa)