JAGUAR Land Rover’s multi-billion pound investment in green automotive technology could be the trump card that secures Treasury backing for a government support package, insiders said last night.

Talks between officials and the luxury car maker’s Indian owner, Tata, almost stalled before Christmas when the Government refused short-term finance to tide the firm over into the New Year.

Tata eventually found the necessary cash, which will keep it going until the end of January, it is understood.

JLR employs around 2,000 people at its Halewood plant on Merseyside, primarily building Land Rover Freelander 2s and Jaguar X-Types.

Now full negotiations are due to resume next week around a longer-term strategic support package, with Treasury officials insisting “due diligence” be carried out on Tata’s complex corporate structure before the deal can finally be signed off.

Sources close to the negotiations between the company and the Government have indicated there is high- level political support for intervention to help keep one of the country’s biggest investors in automotive technology and sustainable industry afloat during the credit crunch.

But the Treasury will have to be persuaded that a package for JLR will not set a precedent, leading to other UK-based manufacturers turning to the Government for similar aid. So far, JLR is the only firm to have done so.

And the signs are that the Government could swing behind JLR on the grounds that the company is the seventh biggest single investor in research and development of any kind in the UK, and is investing up to £3bn in a new generation of highly fuel-efficient, low-emission cars.

Meanwhile, yesterday, Professor David Bailey, an automotive industry specialist, hit back at critics of state aid for JLR.