Eti Khuman's face lies cradled on her mother's shoulder, her cheek resting in against Mina's collarbone. Eti is beautiful, but she is poorly: her breathing is heavy, and Mina has the distracted look of a mother who is very worried indeed. Eti's illness - first vomiting, then diarrhoea - struck without warning. Like all mothers in Bangladesh, Mina knew to fear diarrhoea: in this country, diarrhoea can kill. So she wasted no time in bringing her eight-week-old daughter here, to the main diarrhoea hospital near her home in the capital, Dhaka.

Eti was admitted, and now she and Mina are in the main ward, a sweltering room so packed with beds that there is barely space to walk between them. It's a general ward, but most of the patients are babies. Some, like Eti, are being held by their mothers: others lie quietly on their beds attached to drips. Not one is crying: they are all much too weak for that.

Twenty-five years ago, when Dr Iqbal Kabir first came to work at this hospital, small babies were almost unknown as patients. Today, he says, infants make up as many as 70% of admissions.

The reason? Kabir shakes his head, and points to a poster on the wall above Eti's bed. The same poster is displayed, many times, around the ward. It shows a baby's bottle, with a big cross drawn heavily through it. The message is clear. "Bottlefeeding is harmful," says Kabir. "Because bottlefed babies get diarrhoea, since their formula is mixed with dirty water and since their bottles are not sterile. Do you know how many breastfed babies are admitted here with diarrhoea? The number is almost zero."

Eti has been bottlefed almost since birth: Mina says she wanted to breastfeed, but when she had difficulties there was no one to give advice or support. Mina's story was typical of those of many of the mothers I met in Bangladesh: when she hit problems and went to a doctor, the suggestion was to try formula. In doctors' surgeries and pharmacies across the country, it seems, health professionals are quick - far too quick, say breastfeeding campaigners - to suggest bottlefeeding as the way forward.

Kabir is appalled by her tale, as he has been appalled many times before: in a perfect world, he'd like to see formula milk and bottles removed from general shops, and available only as a last resort, on prescription. "It sounds extreme - but then, it sounded extreme when people first talked about banning smoking. This is the same issue - only with bottlefeeding in my country it's not consenting adults who die, it's tiny babies."

For the moment, though, Kabir's anger is directed at the manufacturers of baby formula. Like many of his fellow health professionals, he believes these manufacturers push their products too aggressively, sometimes breaching the stipulations of an international code on the marketing of formula milk drawn up in 1981, ratified by member states of the World Health Organisation, and enshrined in law in Bangladesh since 1984.

That code, in turn, had been prompted by public support of an international boycott of the products of the company that seemed most culpable 30 years ago: Nestlé. The code could have ended the boycott, but campaigners continue to flag it up because, they claim, the company - and many other baby-milk manufacturers - fail to abide by its requirements. Despite the safeguards it affords, they say, mothers in developing countries - the most vulnerable of mothers anywhere, the ones least able to afford formula milk, the ones whose babies most need the breast milk they could and should be getting for free - were being, and continue to be, targeted by corporate giants bent on carving out their share of a valuable market (Save the Children, which today publishes a report on the baby-milk industry, reckons that the total value of baby-milk and baby-food imports is worth almost £16m a year in Bangladesh alone - but the potential, if more mothers were bottlefeeding, is a lot higher than that).

So, three decades on from the boycott's inception, I have come to Bangladesh to find out whether Nestlé has - as it claims - changed its behaviour, and is now a reformed organisation, or whether the campaigners have been right to keep up the pressure all these years, not just on Nestlé but on other formula manufacturers too.

Down the road from the diarrhoea hospital is the whitewashed Sajida hospital, a private hospital like the one in which Eti was born. Giving birth in a private hospital in Bangladesh isn't just for the wealthy - having a baby here costs only a few pounds - but it is staff in hospitals such as this, say campaigners such as Dr Munir Ahmed of Save the Children in Dhaka, who are targeted by reps from the formula companies. Dr Khaliq Zaman is the paediatrician at the Sajida hospital: yes, he tells us, he receives frequent visits from milk manufacturers, including Nestlé, makers of Lactogen, one of the leading brands in Bangladesh.

"The reps are very aggressive - there are three or four companies, and they come in every two weeks or so," he says. "Their main aim is to recommend their product. Sometimes they bring gifts - Nestlé brought me a big cake at new year. Some companies give things like pens and notebooks, with their brand name on them. They try very hard - even though they know I am not interested, that I always recommend breastfeeding, still they come."

As we talk Zaman holds a pen with the name of a well-known brand of formula milk clearly imprinted on it: the pen isn't expensive, but the giving of all presents to health workers is prohibited under the code. So, too, is the direct promotion of their products to mothers: and yet, the evidence from Zaman is that Nestlé and other manufacturers are getting their message through to mothers none the less.

Here's how: on Zaman's desk, lots of small pads lie scattered: each contains sheets with information about formula milk, plus pictures of the relevant tin. The idea, he says, is that when a mother comes to him to ask for help with feeding, he will tear a page out of the pad and give it to her. The mother - who may be illiterate - will then take the piece of paper (which seems to all intents and purposes a flyer for the product concerned) to her local shop or pharmacy, and ask for that particular product either by pointing the picture out to the pharmacist or shopkeeper, or by simply searching the shelves for a tin identical to the one in the picture on their piece of paper. "I'd never give these pieces of paper out - when I've got a big enough bundle, I take them home and burn them," says Zaman. But that does not mean every other health worker would do the same.

At least three types of Nestlé formula are among the brands whose tear-off pads are on Zaman's desk.

Nestlé spokesman Robin Tickle denies that tear-off pads equate to promoting Lactogen. In fact, he says, the device is "essentially a safety measure. The pads are distributed as information to healthcare workers which ... is allowed under the code. Individual sheets of these are then indeed handed over to mothers, but only after the infant formula has been prescribed by a doctor." He does not accept that the code fails to distinguish between tear-off pads and other sorts of promotion, or that any piece of paper that features a picture of a product a company wants to sell is, arguably, de facto advertising.

The point, he says, is that doctors need - for safety reasons - to make clear to women whether they need Lactogen 1 (for younger babies) or Lactogen 2 (for older ones). So it isn't, then, simply a case of Nestlé exploiting a loophole in the international code? Absolutely not, says Tickle: Nestlé is, he says, one of the largest private distributors of information about the benefits of breastfeeding. And yet, as I tell him, I saw no evidence whatsoever of any Nestlé-sponsored pro-breastfeeding literature, despite spending two days touring hospitals, maternity wards and paediatric clinics: doesn't it seem odd that Nestlé is highly efficient at getting its tear-off slips into mothers' hands in Bangladesh (there were prescription pads in abundance in many of the places we visited), and yet fails, as far as I could tell, in getting them what they could really use, which is information on how to breastfeed? And anyway, campaigners question how realistic it is to think that a company such as Nestlé - which has huge amounts of money tied up in formula milk sales - is going to be committed to spreading the "breast is best" gospel.

"The Nestle leaflets with the picture of Lactogen violates the Code if given to mothers," says Costanza de Toma, author of the Save the Children report. "The truth is that formula manufacturers are clever - they look for grey areas in the code, and they exploit them." Given that the code does not allow them direct access to mothers, she alleges, the companies have become adept at channelling their efforts into getting health workers on side. In any country, but particularly in a country such as Bangladesh where antenatal education is minimal, and where access to other sources of information is limited, the messages new mothers get from doctors, nurses and midwives are crucial. Many of the women I met said it was precisely these people who had suggested a move to not just formula in general, but a specific make - often Lactogen.

Samsun Shahida Akhter Rita, 19, mother of 12-week-old Mim, told me she had gone to a doctor because she was worried about how much Mim was crying. "The doctor said to try Lactogen ... he said give breast milk as well, but try Lactogen." (Breastfeeding experts warn that - aside from the dangers of dirty water being used - giving even some formula milk undermines the breastfeeding process.)

Another young woman, 17-year-old Samsun Nahar Shenli, mother of 13-week-old Tanjila, told me she was advised to start bottlefeeding on the first day of her baby's life. "I talked to the doctor and he said to put her on a certain type of formula. He said the formula and breast milk were very similar, with the same vitamins." Since then, she says, four of her friends have had babies and when they've encountered problems with breastfeeding, she has passed on the word to them to try My Boy.

Even in the UK, formula companies exploit loopholes where they can. In 2006, when the government here launched a new scheme, Healthy Start, to replace the Welfare Food Scheme, two of the biggest producers of formula in Britain - Cow & Gate and Heinz - tried to use it as a marketing opportunity. "Cow & Gate produced adverts saying its baby milk was 'closest to breast milk', a claim which is disallowed under the code, until the Department of Health clamped down on them; and Heinz published a graph suggesting its formula was close to breast milk and better than competing brands. Both companies were not only violating the code, but also UK legislation," says De Toma.

One of the problems with the WHO code - apart from its many grey areas - is how it is policed. Many countries, Bangladesh and the UK included, have backed its requirements up with legislation. But, says Save the Children, WHO and Unicef could do more. "The WHO ... must be bolder in getting companies to comply," it says in today's report. "Unicef must ensure that compliance with the code becomes a measure of progress on countries' implementation of the UN Convention on the Rights of the Child."

Within Bangladesh, there is a feeling that if breastfeeding campaigners take their eye off the ball for even a moment, the formula companies will quickly gain ground. At the Institute of Public Health and Nutrition in Dhaka - the government body charged with implementing the curbs on formula manufacturers - director Professor Dr Fatima Parveen Chowdhury is looking askance at several tins of formula milk piled up on her desk. She frowns at the cartoon pictures on the cover - too attractive, she says; too tempting - and frets over the wording on the cans. "The code requires companies to put words on the can saying there is no substitute for breast milk, but on this can those words are too small, it's written in tiny letters that it's a breast-milk substitute, and it won't do," she says.

There are other problems, too: many companies that sell formula milk in Bangladesh have failed in their legal duty to register with her department, and that makes it difficult to keep track of what they're up to. "I talk to companies and in front of me they seem to be reasonable," Chowdhury says. "But I'm not convinced. We have to be watchful. They push their products in different ways. They are doing wrong things. They are very technical, very sly."

Or even, sometimes, outrageously flagrant. Public advertising by baby-milk manufacturers is explicitly banned in the WHO code and in Bangladeshi law, but Ahmed takes me to a doctor's waiting room in a Dhaka suburb whose walls are adorned with posters showing healthy-looking babies, and the names of baby-milk manufacturers (not Nestlé, in this case). Strangely, it seems to me, the babies in the posters are all Caucasian: but Ahmed has an explanation. "For many people here, what white people do is the right thing to do," he says. "So putting white people on posters like these sends out the message that it's the western way, the best way. It's one of the many subtle ways in which breastfeeding is undermined here."

So is breastfeeding declining in Bangladesh? It's difficult to tell, says Dr Swapn Roy, secretary general of the Bangladeshi Breastfeeding Foundation, because the statistics are not reliable. Around 95% of mothers are believed to start breastfeeding, but by one month the figure is down to maybe around 89%, and at six months (the age to which, under WHO recommendations, all babies should be wholly breastfed), the figure is maybe 25%, but could be as low as 16%. Anecdotally, many health professionals feel the tide is shifting against them, and if you cast around at hospital paediatric clinics, as I did last week, there is certainly no shortage of mothers who bottlefeed their babies.

No shortage of mothers, and no shortage of sad tales. Because bottlefeeding is more than a health tragedy in this country: it is an economic tragedy, too. Happi Akther, 35, talks to me as she waits to see a doctor about her nine-month-old son's flaky-skin problem: Nur has been bottlefed, she says, since he was about a month old. "I felt I didn't have enough milk," says Happi, whose two previous babies both died soon after birth. "What else could I do? No one had any other ideas." (In fact, breastfeeding experts believe at least 98% of women - even those on nutritionally deficient diets in developing countries such as Bangladesh - can make sufficient milk to feed their babies, given proper advice and support.) Nur has been fed on Lactogen from the outset, but his formula, she says, costs her and her husband Gias, who works in a mustard-dyeing factory, around 800 taka (£2) a week. And if that doesn't sound much, set it against the fact that Gias earns only £6 a week. "We can't afford it at all," says Happi, shaking her head. "The milk uses up all our money." All the mothers I spoke to - most of whom were non-working wives whose husbands worked in factories or did manual jobs - had similar stories. (Of the 10 women I interviewed in the clinics, only one said she had begun using formula because she needed to go back to work.)

For some families, the burden of buying formula milk is simply too much. "They can't afford to mix it at the required proportion, so to make it go further they use too little powder," says Dr Roy. "Or they resort to using ordinary powdered milk, which is a lot cheaper to buy than branded baby formula. The result is babies whose milk is little more than what you might call white water."

According to Save the Children's report, infant mortality in Bangladesh alone could be cut by almost a third - saving the lives of 314 children every day - if breastfeeding rates were improved. Globally, the organisation believes, 3,800 lives could be saved each day. Given that world leaders are committed to cutting infant mortality by two thirds by 2015 as one of the Millennium Development Goals, protecting and promoting breastfeeding is almost certainly the biggest single thing that could be done to better child survival rates.

But the formula companies, despite the international code, continue to undermine campaigners' efforts. Throughout the west as well as in the developing world, the amounts spent on "breast is best" campaigns are dwarfed by the amounts food manufacturers spend on promoting their products: in the UK, for example, Save the Children reckons that for every £1 spent in 2006-7 on breastfeeding promotion, £10 was spent by manufacturers on advertising and promoting baby milk and foods. If companies such as Nestlé genuinely wanted to do what Tickle says they want to do, which is support breastfeeding, there is a simple way forward: convert its efficient, and effective, network of sales reps into an equally efficient and effective network of breastfeeding advisors. With the right support, there is no doubt that babies such as Eti Khuman and Nur Akther would be breastfed, along with all the other babies whose mothers I spoke to in Bangladesh, because all were very clear about one thing, which is that breastfeeding would be preferable to the expense of formula and the dangers of diarrhoea.

Back in Dhaka, at the diarrhoea hospital, Eti is on the mend. She and her mother Mina have spent time with a breastfeeding counsellor, and Mina has agreed to try to start breastfeeding again. Dr Kabir is delighted - he says as many as 70% of mothers who give up breastfeeding can get their milk going again, given proper support and advice. All the same, it would have been infinitely better if women such as Mina never stopped breastfeeding in the first place, and that would be easier to achieve if formula-milk companies such as Nestlé curbed their efforts to sell their products. Because the truth at the centre of this story is this: for babies such as Eti and Nur, in countries like Bangladesh, there is no healthy substitute for breastfeeding.

The history of the Nestlé boycott

Henri Nestlé, founder of the world's largest food and drink company, is credited with being the inventor of formula milk, back in 1867. By the late 20th century, the formula-milk market had grown into an industry worth billions of dollars worldwide, and Nestlé was a major player.

With such a huge market at stake, formula companies were accused of acting in ways calculated to undermine breastfeeding mothers, giving out free samples of their products and targeting women directly through advertising campaigns. The marketing message was that formula was as healthy as breast - even though in some countries the women had no access to clean water to mix up the formula with. In some instances, cans of formula were being sold with the instructions in the wrong language for the women being targeted.

These allegations first came to prominence in the late 1970s, in a notorious court case. The charity War on Want had published a pamphlet called The Baby Killer in 1974. When it was released (in amended form) in Switzerland with the title Nestlé Kills Babies, the food giant began a legal suit. It eventually won the case, but it was a Pyrrhic victory: the organisation responsible for publishing the booklet in Switzerland was ordered to pay only a token fine.

The following year, 1977, saw the start of calls for a boycott of all Nestlé products in the US; the boycott quickly spread to Europe. In 1981, as a result of the boycott, the World Health Assembly (the decision-making body for WHO) adopted the International Code of Marketing of Breast Milk Substitutes, calling it "a minimum requirement" to be adopted "in its entirety". In 1984, Nestlé agreed to implement the code, and the boycott was officially suspended by the groups who had done most to promote it. But in 1988 the International Baby Food Action Network (Ibfan) alleged that baby-milk companies were flooding health facilities in the developing world with free and low-cost supplies, and the Nestlé boycott was resumed the following year. In 2000, Nestlé's chief executive said the company would ensure labels always had instructions in the appropriate language - but campaigners claim many aspects of the code continue to be violated, and argue that consumers should still boycott the company.

No one argues that Nestlé is the only company to have been involved in less-than-perfect practices - Ibfan and, in the UK, the campaigning group Baby Milk Action, say they target the company because they claim it has violated the code more than any other single company worldwide, and also that - as a market leader - it should be setting an example.

Nestlé is tight-lipped about the effect of the boycott on its sales or public image. But, 30 years on, feelings continue to run high. This week, users of a UK parenting website, Netmums, took its founders to task after the site agreed a sponsorship deal with Nestlé, and on Saturday demonstrators will gather outside the company's HQ for a show of strength in favour of a cause that refuses to go away.

· Sources: babymilkaction.org and ibfan.org