The B C Khanduri government seems to be in no hurry to provide concession on lease rent as well as some more land to Tata Motors [Get Quote] at the Pantnagar industrial estate.

A high-level meeting, held on Tuesday, took no decision on the demands of the auto major and instead left it to the chief minister. However, top officials here said a positive note would soon be put before the state cabinet to take a final decision.

The company wants the lease rent for its 1,000-acre industrial plot at Pantnagar for the Ace truck manufacturing facility to be lowered to Re 1 per sq metre from the present rate of Rs 5. Besides this, the company is seeking an additional 100-200 acres at Pantnagar for housing.

Tata Motors was allotted 1,000 acres of prime agriculture land at the Pantnagar industrial estate at throwaway prices in the hope that the company would set up its Nano project in the hill state, by the previous Congress government.

With the company now facing problems in Singur in West Bengal, there are indications that it may shift the Nano project here. The state agriculture department is opposing the move to give more farmland to Tata Motors since it wants a blanket ban on farmland use for industrial purposes.

But the previous Congress government had made a commitment to the company that it would provide more land. This has put the government in a dilemma, more so because the Uttarakhand government has expressed readiness to provide all the facilities to the company in case it shifts its Nano project to the Pantnagar industrial estate.

Tata Motors is producing 75-tonne Ace vehicles at its manufacturing plant at Pantnagar in Kumaon, where it has invested Rs 1,000 crore (Rs 10 billion). The land the company got belonged to Pantnagar Agriculture University. At present, Tata Motors' plant produces 225,000 Ace vehicles every year in Pantnagar.

Nearly 63 ancillary units of Tata Motors have set up shop in the industrial estate with an investment of Rs 900 crore (Rs 9 billion).