Prime Minister David Cameron on Friday unveiled an £859 million (1.2 billion euro, $1.3 billion) contract for BAE Systems to build new warships for the British navy, the defence ministry said.
"This is a substantial investment in our shipbuilding industry," Cameron said in a statement, which added that around 1,700 jobs would be sustained as a result of the funding.
The defence ministry contract is for the development of a new type of frigate for the Royal Navy known as the T26, which Cameron said would be "the most advanced modern warships in the world."
The ministry said the new frigate would be suited for "complex combat operations, counter-piracy, humanitarian and disaster relief work."
Conservative Party leader Cameron, who is running for re-election in May, said the investment was part of the government's commitment to invest more than £160 billion in defence equipment over the next 10 years.