The United Kingdom is set to invest $621 million into Tata Steel to decarbonise its Welsh site. The UK on Friday announced that it had agreed to a joint investment package with Tata Steel for the country’s largest steelworks in Wales.
The deal is aimed at securing the future of the country's steel industry but may put as many as 3,000 jobs at risk.
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Out of the $1.55 billion funding package for Britain's biggest steel works, Tata is expected to invest about $931 million to pay for the switch to producing steel from lower-emission electric arc furnaces from coal-powered methods.
Britain's government has assured that this funding would safeguard about 5,000 jobs. However, the switch to lower-carbon electric furnaces may affect 3,000 jobs as the new model are less labour intensive.
As per Reuters, India-owned Tata Steel had long warned that without government help it could close its sites and British business and trade minister Kemi Badenoch said on Friday the government was securing jobs for the long-term.
"The UK government is backing our steel sector, and this proposal will secure a sustainable future for Welsh steel and is expected to save thousands of jobs in the long term," she said in a statement.
The government further said that Tata Steel UK would now inform and consult with staff and unions on the proposals.