I would only remove that bit as a last resort . You have two options in my opinion. Option one . Remove rear wheel, and if you can get in with an angle grinder, grind half of that bit away . Although that will reduce its strength, half a loaf is better than no bread . Option two,the ultimate solution would be to remove that part, and make a new part, and weld it in about one inch nearer the front of the bike. Actually there is a third option . Remove the part , and check if there is side to side flexing of the bike rear triangle under pressure with the wheel fitted . If this unduly weakens the frame, you can still have a new bit welded in to clear the tyre.