The planned construction of a highway through a national park and indigenous territory has been suspended by Bolivia's president after police clashed with demonstrators who have been marching for more than a month to protest against the plan.
Evo Morales announced his decision on Monday, hours after police released hundreds of activists who had blocked roads and stopped airport traffic in an attempt to prevent other arrested protesters from being taken out of the area.
"We repudiate the excesses yesterday at the march," Morales said, adding that a high-level commission including international representatives should be formed to investigate the crackdown.
One young child reportedly died as a result of tear gas inhalation.
The crackdown came 41 days into an indigenous-led march against the government-supported plan to build a 300km highway that would connect Brazil with Pacific ports in Chile and Peru.
In a brief televised address on Monday night, Morales announced that he was suspending the highway project and would let the two affected regions, Cochabamba and Beni, decide whether to proceed with the Brazil-financed road.
Earlier on Monday, Cecilia Chacon, Bolivia's defence minister, resigned in protest against the crackdown, increasing pressure on Morales over his handling of the situation.
As a result of the crackdown, several people suffered minor injuries, according to local media reports, which was criticised by opposition politicians, the ombudsman and several government officials.
"This is not the way! We agreed to do things differently," Chacon wrote in her resignation letter, which was published by Bolivian media on Monday.
Ivan Canelas, the country's communications minister, said that police had no choice when responding to the protests.
"The march was defused because it had become a source of violence," he told the Reuters news agency.
Police surged into the demonstrators' camp with "extreme violence", veteran activist Maria Carvajal told the AFP news agency. "I could not believe what was happening."
On Monday, protesters reacted by setting barricades on fire on the airport runway in the town of Rurrenabaque, in an attempt to free about 300 marchers who were being held by authorities, Mayor Yerko Nunez told local media.
In La Paz, the capital, riot police set up a security cordon around the Quemada government building, as thousands of demonstrators gathered outside to protest against the crackdown.
Other protests were also held in the central city of Cochabamba, where students marched and majority Aymara and Quechua indigenous peoples began a hunger strike.
Protests were also held in the northern province of Beni and in Santa Cruz.
Split in ruling party
Morales, Bolivia's first indigenous president, put the controversial $420m highway at the heart of his infrastructure structre plan for the country.
The highway has elicited fierce opposition, however, from local indigenous leaders, who traditionally support Morales. The split has exposed differences within Morales' Movement Toward Socialism party.
Some MAS politicians have expressed support for the demonstrators and the demands of the 12,000 residents of the Isiboro Secure Indigenous Territory and National Park, through which the proposed road would be built.
In June, Morales angered activists by saying that the road would be built through the territory "whether they like it or not".
Morales is highly popular among the Quechua and Aymara indigenous majority in the Andean highlands, but opposition to his policies is strong in the eastern lowlands, even among indigenous groups.
Fallout from the unrest could put him in a defensive posture for the nationwide judicial elections in October, which are part of broader reforms put in place to give indigenous people more political power.