Producers of formula for infants, who see their business as helping to keep babies alive, went before a Senate subcommittee yesterday to answer charges that their marketing and promotion practices contribute to the sickenss and deaths of thousands of babies in developing nations.

The event - complete with television cameras, scrabling reporters and an overcrowded hearing room - was the latest development in an emotion-laden controversy that began in the early 1970s.

The key issue, as put by Chairman Edward M. Kennedy (D-Mass.) of the Senate health and scientific research subcommittee, is, "Can a product which requires clean water, good sanitation, adequate family income and a literate parent to follow printed instructions be properly and safely used in areas where water is contaminated, where sewage runs in the streets . . . ?"

For several years, the answer from many missionaries and medical professionals working in places such as Jamaica and Peru has been "no."

But five industry officials who appeared before the subcommittee yesterday disagreed.

David O. Cox, president of the Ross Division of Abbott Laboratories, which has about 10 percent of the infant-formula market in developing countries, said there is no proof that formulated feeding products worsen the problems presented by dirty water and other unsanitary conditions. He also said there is no proof that the use of infant formula has led to a decline in breast-feeding, as critics charge.

"Many of these charges are circumstantial, anecdotal, exaggerated or biased, although very effective in stimulating controversy," Cox said.

"Everyone acknowledges that the use of any type of breat-milk supplement or alternative can create problems whem combined with poor sanitation, poverty, impure water or misinformation. But we cannot seem to agree that there would be more serious problems if such alternatives were not available."

Cox said his company has adopted a "code of marketing ethics for developing countries" designed to curb the misuse and to encourage the proper at-home preparation of formula products.

Key parts of the code reject the use of mass-media advertising, restrict promotion of infant-formula products to health-care officials and "affirm the superiority of breast milk" for most infant feedings, he said.

But industry critics, who also spoke at yesterday's hearing, said the Abbot code and others like it have little effect.

"The codes are weak," said Patricia Young, a member of the Interfaith Committee for Corporate Responsibility-National Council of Churches, which has been waging a battle against the infant-formula industry in developing countries.

"The codes do things like codify how to give out free samples of formula, as opposed to how to stop giving out free samples," she said.

One formula opponent, Dr. Navidad Clavano of the Philippines, said representatives of the formula manufacturers often violate their corporate codes by offering special favors - such as cocktail parties and corporate plane flights - to medical officials in the developing countries.

People like Clavano and groups like the interfaith committee have said that the infant-formula companies are pushing their powdered and emulsified products in the interest of profit, rather than nutrition.

The result, according to the critics, is that many poor mothers have forgone the cheapest mode of feeding their newborn, have denied them the protection of needed antibodies found in breast milk and have frequently endangered the health of their children by diluting formula preparations to make them last longer.

'Oswaldo Ballarin, president of the Nestle Co.-Brazil, which produces infant formula, angrily denied the charges, saying: "The U.S. Nestle Co. has advised me that their research indicates this is actually an indirect attack on the world's free economic system."

A red-faced Kennedy shot back: "Now you can't seriously expect us to accept that . . . that these people are involved in some worldwide conspiracy to attack the free world's economic system."

Ballarin apoligized.