Business Secretary Sajid Javid has confirmed the Government is set to launch an "open consultation" on changes to pensions law as part of efforts to save Tata Steel despite being "very wary of setting a precedent".
The consultation, which will run until June 23, sets out a number of different options for the British Steel Pension Scheme and its 130,000 members.
The scheme includes 14,000 people currently employed by Tata or another employer, 32,000 are deferred (no longer employed by Tata but below the scheme's normal pension age) and 84,000 pensioners.
The Government has been warned against the impact of setting a precedent by seeking to change pension law.
"No decision (on Tata's future) has been made," Mr Javid told MPs. "We are very wary of setting a precedent ... this is very much about this scheme and this scheme only in these very unique circumstances."
Shadow business secretary Angela Eagle warned against cutting the fund's long-term liabilities by benchmarking it to the consumer price index (CPI) rather than the higher retail price index (RPI), saying: "This change is currently illegal."
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Pension law changes are to be considered in a bid to save Tata's UK steel operations.
The government is said to be looking at ways of helping Tata to ease its pension liabilities in an effort to persuade the Indian company to abandon its planned sell-off.
First Minister Carwyn Jones, who has been with Mr Javid in Mumbai for talks with Tata, said that he was urging the Government to make legal changes.
The firm's £15 billion pension liabilities have always been seen as one of the biggest obstacles in finding a buyer for its UK assets, including the Port Talbot plant.
The First Minister of Wales, Carwyn Jones, has said a "very positive and constructive discussion" has been held in Mumbai over the future of Tata Steel's UK business.
The Indian conglomerate's board is drawing up a shortlist of potential buyers, although "nobody has yet emerged as a front runner or front runners", added Mr Jones, who has been joined in India by the Business Secretary Sajid Javid.
His comments come as hundreds of steelworkers marched through Westminster to call on the government to save the industry.
What Tata have said is that they need to go through each bid in detail and I welcome that, and that of course will take some time.
What's important here is not to rush things. We need certainty, of course, for the workers in the plants in Wales, where we get to a position where we see a sustainable long-term future for our steel industry.
Tata don't want to let workers down. It is uncertain... but we'll continue to talk to Tata, continue to listen to other bidders who have come forward with a view to getting the right outcome for people.
The leader of the Unite union, Len McCluskey, has called on the government to save the steel industry, as hundreds of steelworkers marched through Westminster to highlight the crisis.
The board of Tata Steel is meeting in Mumbai but has yet to draw up a shortlist of potential buyers for its UK assets.
Thousands of jobs are at risk, with the Port Talbot plant in south Wales facing closure if a buyer cannot be found.
The issue still has to be resolved. We want a secure, guaranteed future for a foundation industry that is vital for our nation.
The whole of our manufacturing depends on British steel and I'm pleased that the government appear to be getting that message, but we want to make certain that those warm words are turned into positive action.
Tata Steel is reviewing all options for its UK business including sale, ITV News understands.
The company said there is "no shortlist" yet for potential buyers.
ITV News' Wales Correspondent Rupert Evelyn has the latest:
Tata reviewing all options for Uk steel business including sale
"No shortlist" yet for potential buyers of Tata steel uk "evaluating bids" say bosses in India
Hundreds of steelworkers are marching today to highlight the crisis in their industry as a shortlist of bidders was being drawn up for the UK assets of Tata.
They are calling on the government to "ensure the responsible sale of Tata Steel's UK assets" and to deliver "a proper industrial strategy that supports the entire steel sector".
The board of the Indian conglomerate are meeting in Mumbai to discuss the prospects for a sale which would save thousands of jobs.
The Welsh Secretary says the Government is determined to find a solution to Tata's complex pension issue.
It came after Stephen Kinnock asked what measures had been taken to ensure a viable and sustainable pension scheme will be developed as a result of the sale of the business.
Alun Cairns said he's met with Business Secretary following his meetings with Tata in Mumbai to discuss the main issues surrounding the sale including the pensions, power and plant.
The team behind a proposed management buyout of Tata's UK operations - Excalibur Steel - has issued a statement clarifying its plans.
Excalibur Steel UK Ltd was created as an entity to manage the financing of an employee and management led buy-out of Tata Steel UK Ltd. Recent media speculation has suggested that Excalibur is not pursuing this objective independently. This is incorrect. Excalibur is working alone and is not currently contemplating acting in conjunction with any third party.”
The First Minister of Wales has been seen leaving his hotel in Mumbai ahead of a meeting with Tata Steel bosses.
The steel giant is holding talks to draw up a shortlist of final bids at a meeting later today.
UK Business Secretary Sajid Javid MP is also in the country to hold the talks with company officials.
A march of hundreds of steelworkers and union representatives is taking place in Westminster calling for more action to be taken on the dumping of Chinese steel.