Frito-Lay’s factory in Sankrail is caught in a stand-off over land possession

The snack-food division of PepsiCo Inc.’s Indian unit finds itself caught in a miniature version of the stand-off in Singur that led to Tata Motors Ltd driving its dream small car project out of West Bengal to Gujarat. And like Tata Motors, it says it may have to reconsider the project.

Frito-Lay India, which makes Uncle Chipps, Lay’s potato chips, Kurkure and Quaker Oats, was allotted a four acre plot in Sankrail—an hour’s drive from Kolkata—by the West Bengal government three-and-a-half months ago to expand its existing unit in the area.

The firm had planned to invest Rs100 crore on expanding the unit, which has been in operation since 2006. But even after having paid for the plot and completing the legal formalities, Frito-Lay has not been able to take possession of the land because two small factories, backed by Mamata Banerjee’s opposition Trinamool Congress, have refused to move out.

Asked about the stand-off, Frito-Lay’s spokesperson Mrinal De issued a statement saying: “In line with our growth plan and further investments in West Bengal, we had requested for additional four acres of land adjacent to our existing manufacturing plant in the food park. The land was allocated to us by WBIDC towards the end of last year. Since then, we have completed payments and following which we expect a smooth handover of land.”