Australian Prime Minister Julia Gillard on Tuesday said the nation's steel industry remains critical to the nation's future, even as the country moves towards a low carbon economy.

On the same day as Gillard introduced to parliament the first of 18 bills to establish the government's carbon tax regime, Gillard admitted that the steel industry faces uncertainty and has some hard work ahead if it is to survive in a clean energy world.

She noted that there are hundreds of steel workers facing a different future as they leave the industry, while more remained in the industry who were wondering what would happen to them as well.

However, she said the future for manufacturing was in innovative and efficient practices, which was why the government would provide permits to the steel industry to cover the impact of the carbon tax.