The world's second-largest food company would make its presence felt initially through an investment of Rs 140 crore on a food-processing plant in Hyderabad by its Kraft Foods division, according to Kraft Foods Indian country manager Ajit Sahagal. Kraft Foods makes some of the world famous brands like Kraft Cheese, Toblerone chocolates and drinks like Tang and Koolaid.

The first phase of the powder food and beverages plant with a capacity of 7500 tonnes per annum, to be set up at an investment of Rs 50 crore, would be completed by February 2001, Sahagal said. Phillip Morris had got the FIPB approval for the project as early as 1996 but the implementation has got underway now with internal approvals coming through only in October 1999 for the food project, he told a CII conference here.

The FIPB approval for the tobacco operations was still awaited, he said. However, the company has earmarked a total investment of Rs 320 crore for the tobacco agronomy project under which Phillip Morris wants to set up a research and technical centre to assist farmers on disease control and other aspects.

The company would also procure leaf from the state and bring in bulk processing technology into the state, Sahagal said.

Stating that the multinational had considered four other states for locating the food processing project, Sahagal who also officiates as the general manager India, for the Phillip Morris Services India Inc., said it found AP to be the most suitable on scale of one to seven.

A survey conducted by the company had considered various criteria such as political stability, incentive policy of the governments, quality of life, infrastructure, etc.

AP had notched up a total score of 59 compared to 57 of Maharshtra, 55 of Karnataka and 52 of Tamil Nadu.

All things remaining equal, the visionary leadership was a significant criteria which the company had tipped the scales in favour of Andhra, he said.