DAVID Cameron has insisted the UK Government will take action to stem the crisis facing the steel industry, saying he would ensure the procurement of “British steel for British projects”.

But his pledge was met by criticism from Nicola Sturgeon, who accused Whitehall of having “sat on its hands”.

The First Minister, who has set up a taskforce to find a way forward for the Scottish industry, made clear she ruled nothing out; some have suggested nationalisation, even if it were on a temporary basis.

Yet the Scottish Government has itself come under fire because the new Forth Crossing is being built mainly from imported steel from China.

After Tata Steel announced nearly 1200 job losses at its plants in Scunthorpe and Lanarkshire with suggestions the industry could face even more hardship because of the “dumping” of cheap Chinese steel on the European market, the Prime Minister was challenged over his Government’s approach.

Speaking at a joint press conference in Downing Street with the Chinese premier President Xi Jinpang, Mr Cameron said: "What I would say to steelworkers in Britain is: we will take action here in Britain.

“We will take action on energy costs, we will take action to make sure we procure British steel for British projects; where we can take action on tax and other issues, we will take that action; where we can take action in the European Union, we will take that action.”

He pointed out how the plan to build a new nuclear power plant in Somerset would be done using British steel and that Europe’s largest construction project, Crossrail in London, was using almost entirely British steel.

"The infrastructure partnerships we are talking about, the investment we are opening up, means more demand for British steel because that is the way we are going to make sure procurement works in Britain,” declared the PM.

Mr Xi was challenged over claims the UK’s crisis was due to his country’s excess steel exports but he countered by saying that China too was having to deal with job losses because of a global problem.

"The world is facing an over-capacity of iron and steel, not just the UK,” insisted the President. "This is because of the impact of the international financial crisis, the reduction of demand. China's iron and steel industry is also facing excess capacity and the challenge of how to absorb that capacity.

"China has taken a series of steps to reduce the capacity. We have reduced more than 700 million tons of production capacity and you can just imagine our task of finding jobs for those workers," he added.

Later, the PM’s spokeswoman was asked whether or not Mr Cameron had accused China of dumping cheap steel on the international markets, she replied: "I'm not going to go into the specifics of their conversations but the PM, both at their lunch and the talks in the Cabinet room that followed, raised the concerns about the global steel industry, the level of production, the fall in prices, the impact that is having on British industry and, indeed, steel industries elsewhere."

Earlier at Prime Minister's Questions in the Commons, Labour leader Jeremy Corbyn accused the Tory Government of having no industrial strategy and asked Mr Cameron if he appreciated the “devastating effects of the Government's non-intervention in the steel industry is having on so many people?"

The PM insisted he wanted to "help our steel industry" but it was “in a very difficult situation; world prices have collapsed by more than half, the surplus capacity in the world is more than 50 times the UK output".

Mr Cameron challenged Labour to examine its own record as he argued that steel production had halved under it but gone up under the Tories.

He told a rowdy Commons at the end of PMQs: "So before we get a self-righteous lecture from the party opposite, look at your own record."