Font: BBC
The board of Tata Steel is meeting in India to discuss the future of its UK steel operations. It is expected to "pause" the sale of the main Port Talbot plant, but go ahead with the sale of its speciality business, which employs 2,000 people in Hartlepool, Rotherham and Stocksbridge. Tata is thought to be in less of a hurry to sell because of rising steel prices and signs of government support.
Business Secretary Sajid Javid is in Mumbai for talks with the company. Tata is expected to delay the sale of much of its UK business to consider the options and assess the impact of the UK's vote to leave the European Union.
Government aid
One of the biggest obstacles to the sale of the UK business has been the legacy of the British Steel Pension fund, which Tata inherited when it bought the business in 2007. It has 130,000 members and a deficit of £700m. The government has been trying to help here by consulting on drawing up special legislation to lower pension benefits for many of the 130,000 members of the old British Steel pension fund. It has offered hundreds of millions of pounds worth of loans and the taking of a potential 25% stake in the business.
In the meantime, the price of steel has increased, reducing pressure on Tata to sell. But a delay may only provide short-term relief for some of the workforce. One potential bidder fears the UK business will "wither on the vine" while Tata refocuses its investment on its plants within the EU. German engineering conglomerate Thyssen Krupp and Tata have held talks on combining their continental European steel operations, as global overcapacity weighs on prices and profits.
New trade
Mr Javid will also meet the Indian government in Delhi as part of a wider trade mission to drum up business with India, post Brexit. He will discuss how the trading relationship with India might work with the UK outside the European Union, he will also visit the US, China, Japan and South Korea in the coming months.
India is the third biggest foreign investor in the UK, according to UK Trade and Investment. Total trade between the two countries was £16.55bn last year, the government body said. Brexit supporters argue the UK will be able to negotiate better trade deals with fast-growing economies such as India than it currently has as an EU member.
To help redraw those trade relationships, the UK government this week announced plans for a new team of up to 300 specialist staff, including trade negotiators, by the end of the year. However, Foreign Secretary Philip Hammond admitted on Thursday the UK would rely on "friendly governments" to help bolster its staff.
"The government will have to acquire additional trade negotiation resources," Mr Hammond told a committee of MPs. "We will look to friendly governments to assist us, as well as seeking to hire the best resources available on the open market."
The EU has trade agreements with 52 countries and it is expected the UK will need to re-negotiate these as part of Brexit. Commonwealth countries accounted for about 10%, or £47.8bn, of UK exports in 2014, whereas about 44%, or £228.9bn, were with the EU. Indian-owned companies employ about 110,000 people in the UK and grew revenue by £4bn to £26bn last year, according to a report by Grant Thornton.
Tata Motors, which owns Jaguar Land Rover, added an extra 4,000 jobs to employ nearly 33,000 people, the report said. Meanwhile, sister business, Tata Global Beverages, which owns Tetley Tea, employs more than 1,000 UK workers.
Condividi questo articolo
