UK's biggest broadband and mobile provider BT said Thursday it would take a 500 million pounds (650 million U.S. dollars) hit after the government limited Huawei's role in developing the country's 5G network on security grounds.

"We are in the process of reviewing the guidance in detail to determine the full impact on our plans and at this time estimate an impact of around £500 million over the next 5 years," Philip Jansen, BT's chief executive, said in a statement.

He added that the company welcomed the government's decision, which was announced on Tuesday, noting that "the priority should be the security of the UK's communications infrastructure."

Britain chose to exclude Huawei from "core" parts of the network and cap its share of the market at 35 percent.

The move to grant Huawei access, albeit on a limited scale, has caused a diplomatic spat between Britain and the U.S., with Washington having pressed for a total ban.

Washington has banned Huawei from the rollout of the fifth-generation mobile network. A total ban requires huge amounts of infrastructure to be ripped out at great expense, while also delaying 5G rollouts by years, according to analysts.

Unlike the United States, Britain has long been using Huawei technology in its systems.

"We have supplied cutting-edge technology to telecoms operators in the UK for more than 15 years," said Victor Zhang, vice-president of Huawei.

"We will build on this strong track record, supporting our customers as they invest in their 5G networks, boosting economic growth and helping the UK continue to compete globally,”he said after the UK decision on Tuesday.

Huawei is widely viewed as providing the most advanced 5G for the super-fast data transfers behind technologies such as self-driving cars and remotely operated factory robots.

Huawei UK has created huge job opportunities for the local community, contributed to the telecommunications sector in the UK and played a positive part in the economic and social progress in this country, the Chinese Ambassador to Britain Liu Xiaoming said at an event in London on January 27 night.

(With input from AFP)