Violent protests by farmers over land rights have caused a factory in West Bengal to suspend building the cheapest car in the world.
Some international staff at the Tata Motors site have gone home and the company told other workers not to bother turning up to work at the Nano factory.
Hundreds of local farmers blockaded the highway running past the factory, claiming they did not receive sufficient compensation for part of the land where the Nano factory was built.
Last week the demonstrations escalated and protesters trapped workers inside the factory.
The situation involves one of India's richest men, Ratan Tata. Priced at about £1,370, the Nano has knocked the bottom out of the mini-car market in India, with other automotive players pushing to enter the super-economy market.
A company 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."
Tata Motors has invested £192 million in its plant in Singur. About 60 key suppliers have invested millions more for plants and equipment in the area.
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