Five unidentified men bludgeoned two private security guards at the Tata Motors Nano factory in West Bengal putting one in the hospital, police said Tuesday. Monday's attack adds to security concerns surrounding the US$350 million plant in Singur where Ratan Tata hopes to build the world's cheapest car.

The company already halted work at the plant earlier this month, fearing for employee safety, amid a dispute with local farmers. Farmers complain they were not fairly compensated for the land where the new factory now sits.

They have protested against local government leaders and Tata, who has a reputation as one of India' s most benevolent industrialists. Days of intense negotiation between ruling Communist Party officials in Singur, who support the industrialization of West Bengal, and opposition Trinamool Congress Party politicians, who have been leading demonstrations of disgruntled farmers, have got nowhere.

Police are still hunting for the factory guard attackers, West Bengal Inspector General of Police for Law and Order Raj Kabnojia said Tuesday. The U.S.-India Business Council hastily canceled a planned visit to West Bengal this week, which was to be led by executives from Cargill Inc.

and Boeing Co. "It doesn't make sense for us to go out there to talk about development when there's not a conducive environment for business," Ron Somers, the group's president, said by phone from New Delhi.

"If Ratan Tata can't succeed there, how can an American company?" Ravi Chaudhry, the chairman of Cemex Consulting Group, an Indian investment advisory firm, said he's not sending his clients, one of whom is an automaker, to West Bengal. "I'll send them elsewhere," he said, adding that for the investors he works with, the overall draw of India' s fast-growing market outweighs the problems at Singur.

Officials from 11 other Indian states have invited Tata Motors to relocate the Nano plant to their territory, said Suresh Rangarajan, a Tata spokesman. Tata has drawn up alternative production plans in an effort to launch the Nano by year's end, but has yet to publicly comment on whether it will pull out of Singur.

The government, which acquired the land from farmers and handed it to Tata Motors, has sweetened its deal, offering farmers additional compensation and job guarantees. About 150 of the 800 farmers who refused to sell their land have accepted the new offer, said Subrata Gupta, managing director of West Bengal's Industrial Development Corporation.

The government has extended the deadline for farmers to accept the revised package until Wednesday. "Let them extend the date indefinitely.

It will not help. Unwilling farmers want their land back," said Trinamool leader Mamata Banerjee.

Khokan Sahu, a farmer with two acres (0.8 hectares) of land, decided to accept the revised government deal, after he began to fear Tata might pull out. "I joined the agitation like many of my neighbors," he said.

"But with the growing uncertainty of the Tata project, I thought of opting for the government package, which is good." ___ Associated Press writer Manik Banerjee in Calcutta contributed to this report.