Mumbai headquartered Tata Steel’s decision to exit operations in Britain has put thousands of jobs on the line.
In recent times, the steel giants have been losing an estimated £1 million a day in its UK operations whilst share prices have nearly halved in the past five years.
Despite such figures, Prime Minister David Cameron said on Thursday that the government will do all it can to ensure the industry remains in towns and cities in the UK.
“The situation at Port Talbot is of deep concern. I know how important those jobs are – those jobs are vital to workers’ families, vital to those communities,” he said.
“The government will do everything it can, working with the company, to try and secure the future of steel-making in Port Talbot and across our country. It’s a vital industry.”
Labour leader, Jeremy Corbyn, also urged the Prime Minister to take action, telling workers that they were ‘not expendable on the altar of a global corporation’.
He continued: “Steelworkers and their families will be desperately worried about the uncertainty.
“The government is in disarray over what action to take. Ministers must act now to protect the steel industry, which is at the heart of manufacturing in Britain and vital to its future.”
Tata Steel, which operates Britain’s biggest steel plants, has put its cash-bleeding business up for sale, saying it cannot promise to keep the plants open while it seeks a buyer.
Its move to sell its UK business comes less than three months before the referendum on 23rd June as to whether the UK stays in the European Union.
Industry leaders have blamed the EU for preventing London from taking greater steps to look after the steel industry.
Speaking about its decision to sell the UK business, Koushik Chatterjee, group executive director of finance and corporate of Tata Steel, told NDTV Profit: “There has been a rapid deterioration in performance in UK in the last 12 months, impacted by the currency, imports and muted market.”
Business Secretary Sajid Javid says the steel industry is ‘vital’ to the UK’s economy and released a statement on Wednesday, before he stepped onto a plane to return to the UK from Australia.
He said: “I’m deeply concerned about the situation. I think it’s absolutely clear that the UK steel industry is absolutely vital for the country and we will look at all viable options to keep steel making continuing in Port Talbot.
“We are also very much alive to the human cost and we want to make sure no worker is left behind so where workers are affected that we are doing everything we possibly can to help them and their families.
“At this stage, given the announcement from Tata has just come out, it’s important I think we talk to them properly and understand the exact situation and we look at all viable options.
“I don’t think nationalisation is going to be the solution because I think everyone would want a long-term viable solution.
“And if you look around Europe and elsewhere I think nationalisation is rarely the answer, particularly if you take into account the big challenges the industry faces.”
Tata Steel is the second-largest steel producer in Europe.
It has a crude steel production capacity of over 18 million tonnes per annum across the continent, but only 14 million is operational.
Two of its three main European units, Port Talbot and Scunthorpe, are in Britain, with the rest in the Netherlands.