Rising from the lush green paddy fields 40 kilometres from India 's decrepit former colonial capital Kolkata, Tata Motors' [Get Quote] flagship Nano car factory was expected to bring jobs and prosperity to a region little touched so far by the forces of globalisation now transforming other parts of India.

Instead, the high-profile plant in Singur - where Tata planned to produce the world's cheapest car for India and for export - foundered on resistance of farmers such as 55-year-old Prabhat Shi, who saw little role for himself in the industrial sector, and preferred to cling to time-tested ways of living.

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Disgruntled at the state government's acquisition of his fields for the factory at a price he considered far less than fair value, Mr Shi joined protracted protests against the project - protests that finally drove Ratan Tata, one of India 's most respected industrialists, to abandon the site.

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Mr Tata, group chairman, who steered his company's takeover of UK brands Jaguar and Land Rover, said on Friday he saw no end to the sometimes violent resistance that had threatened workers' safety and halted construction, leaving him no choice but to withdraw - though work was nearly complete and the Nano roll-out due to begin later this month.

Walking barefoot and clutching a cow harness near the desolate, barricaded factory site the next day, a subdued Mr Shi expressed neither regret nor triumph at Mr Tata's move.

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"My forefathers and I have nurtured our family on this land. It is productive; it has a deep tube well and I have married off my daughter with its profits, so why should I give it up," he said. "I have a hunch that Tata will come back again anyway."

To many other residents of Gopalnagar, a settlement of sturdy concrete and brick houses tucked amid coconut trees and fishponds just outside the project area, Mr Tata's shock decision comes as a devastating blow and a pyrrhic victory for the agitators.

Villagers said the Tata pull-out would leave them without jobs or job prospects, while their former lands - a low-lying, marshy area - have been so worked over to prepare for industrial use that it would be uncultivable for decades - even if the land law permitted its return to the original owners, which it does not.

"We have given the land already, but can it really be taken back?" asked Lolita Sau, a deeply furrowed 60-year-old, who agreed to give up her smallholdings in the hope of chances for her 22-year-old son in a rising new auto industry. "If the factory doesn't happen, it's a completely futile exercise."

Across developing Asia - including fast-growing China and Vietnam - farmers have resisted the acquisition of their lands for industry or real estate development, often due to anger at low compensation but sometimes simply reluctance to give up familiar ways of life.

Yet West Bengal state authorities say that of the 13,000 families whose land was acquired for the car factory, just 1,000 - accounting for about 15 per cent of the total project area - refused to accept the compensation. The rest were willing to gamble that industrial development would bring them greater long-term benefits than their fragmented patches of land.

Agitation against the project gained momentum after Mamata Banerjee, West Bengal's opposition leader, threw her weight behind it in her own political battle with the state's Communist government, which was pushing the project hard.

Ms Banerjee mobilised a vocal group of Kolkata-based, middle-class social and left-oriented activists, many of whom are deeply antipathetic towards big business and have a romantic vision of villager as representing the true India.

"These so-called friends of the farmers don't have any taste of rural life, but they feel our civilisation, our countryside should remain as it is - that there should not be any change," said Biman Basu, the Communist party head in West Bengal.

Subir Pyne, 26, from a village just near the factory, does not feel the agitators have done him any favours. In the past, Mr Pyne paid Rs20 ($0.42, euro 0.31, pound 0.24) to travel two hours to and from Kolkata each day to earn Rs90 a day as a security guard. But once the car plant got started, he was hired for Rs110 a day at the site, a bicycle ride away.

Clutching his now useless Tata ID, Mr Pyne is also clutching at the hope that Tata will return, saying "if the Tatas go away, common people here will become like beggars".