Amar Ghosh, a real estate broker, is negotiating a deal with a Mumbai-based company for 65 acres around Singur, 40 km from Kolkata, at Rs 22.5 lakh (Rs 2.25 million) per acre.

The last deal he did before work began on the Tata Motors' small-car project in this fertile potato-growing belt was at Rs 450,000 per acre.

Ironically, the project that attracted national attention for protests over land acquisition for Ratan Tata's dream small car project has become the cynosure of local real estate developers hoping to cash in on heightened corporate interest in land deals in the area.

Land prices around the project site are now twice or three times the per-acre compensation the state government paid to farmers. This compensation itself was as much as a 130 per cent premium to market prices prevailing then.

Now, against Rs 870,000 per acre for single-crop land and Rs 12.76 per acre for multi-cropped land, land around the Tata Motors' 997-acre factory and vendor park costs Rs 22-24 lakh (Rs 2.2-2.4 million) per acre.

Land prices had started rising in the area when construction of National Highway 2, which passes Tata Motors' factory, began in 2002. That was when prices shot up from Rs 24,000-30,000 an acre to Rs 150,000 an acre.

Subsequently, new industrial units pushed up prices to Rs 300,000 an acre.

But the market dynamics changed radically when the controversy over land acquisition for Tata Motors' project subsided. So much so that a Kolkata real estate developer says there are more land speculators at Singur than are companies wanting to set up projects.

Many of these speculators made money selling plots to the government for the Tata project. "They have bought the frontage 3-6 km away from the Tata Motors project site, without which no company or real estate developer will be able to set up projects," a real estate source said.

Ironically, these speculators were able to acquire land from farmers at low rates ahead of the land-acquisition drive for the Tata Motors' project because their activities were low-key and attracted no political interest, unlike the state government's.

Significantly, the state government had said that around 500 private real estate deals were closed in Singur before the Tata Motors project was announced.

However, the speculative rise in land prices may, ultimately, prove self-defeating. Many companies from other parts of India as well as Indonesia and West Asia had evinced interest in setting up ancillary projects around Tata Motors' factory. But high land prices have acted as a deterrent.