Tata Steel today announced restructuring proposals to improve the competitiveness of its South Wales steelmaking business.

The proposed changes would enable the UK Strip Products business to compete in Europe's lower market demand era by reducing costs equivalent to the loss of about 400 jobs in Port Talbot, the company said.

Karl Koehler, Tata Steel's European chief executive, said, "We have invested more than 250 million pound over the last two years in state-of-the-art steelmaking technology in the Strip Products business. In addition, we are currently investing in our Hot Strip Mill in Port Talbot and we have upgraded our galvanising line in Llanwern enabling us to increase production of high-value automotive steels."

"These investments have created a stronger, more efficient and more reliable platform from which we can meet the needs of our customers, with an improved range and quality of products and services," Koehler said.

"But steel demand and prices are likely to be under pressure for some years. Our business rates in the UK are much higher than other EU countries' and our UK energy costs will remain uncompetitive until new mitigation measures come into effect," he added.

Shares of the company gained Rs 13.05, or 2.47%, to settle at Rs 541.35 at the BSE (Tuesday).