Rishi Sunak confronted the Chinese Premier after a Commons researcher was accused of spying for Beijing.
The PM tackled Li Qiang as they met at a gathering of world leaders in India. Two men have been arrested under the Official Secrets Act.
One worked as a researcher in the House of Commons and had links to several senior Tory MPs, including the security minister, Tom Tugendhat, and the foreign affairs committee chair, Alicia Kearns. He was arrested along with the other man by officers on March 13.
Mr Sunak and the Chinese Premier held a meeting at the G20 summit in New Delhi. The PM said he raised his “very strong concerns about any interference in our parliamentary democracy”.
Speaking to reporters afterwards, he said: “Well, I obviously can't comment on the specifics of an ongoing investigation but with regard to my meeting with Premier Li what I said very specifically is that I raised a range of different concerns that we have in areas of disagreement, and in particular, my very strong concerns about any interference in our parliamentary democracy, which is obviously unacceptable.”
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Mr Sunak insisted it was the “right thing to do” to engage with Chinese officials instead of “just shouting from the sidelines”.
He added: “I think our approach is completely aligned with that of our allies. “If you look at how countries like America, Japan, Canada all engage with China, that's what they do, because engaging with people allows you to raise concerns directly. “I think that's a more powerful thing to do. Where there are areas of disagreement or areas of concern that we have, I'd rather be in the room talking to the Chinese directly about those, face to face. “I think that's the right approach. There's no point carping from the sidelines, I'd rather be in there directly expressing my concerns, and that's what I did today.”
He went on: “Our new security strategy has a very clear approach to China which does take the initiative to protect ourselves, protect our values, protect our interests. And you can see real examples of that. For example, recently we blocked investment from China into a sensitive semiconductor company in the UK.
“We've taken similar steps in our nuclear industry and we're passing various laws through Parliament which will protect our educational institutions from foreign interference from anyone, whoever they might be. That's the right approach - being robust, standing up for our values and interests, but actually doing that with proper actions, not just rhetoric. That's what I believe and we are taking actions.”
Chinese President Xi Jinping decided not to attend the gathering and sent the Premier instead. The meeting came a week after James Cleverly made the first visit to Beijing by a British Foreign Secretary in more than five years.
Despite clashes over human rights abuses, Hong Kong and cyber attacks, Mr Sunak has taken a less hostile approach to China than his recent predecessors and insisted diplomatic relations are needed to deal with issues including climate change and Artificial Intelligence.
But former Tory leader Sir Iain Duncan Smith has compared the current approach to the appeasement of Nazi Germany in the 1930s. The members of the G20 are Argentina, Australia, Brazil, Canada, China, France, Germany, India, Indonesia, Italy, Japan, Mexico, Russia, Saudi Arabia, South Africa, South Korea, Turkey, the UK, the US, as well as the EU.
The Metropolitan Police said: "A man in his 30s was arrested at an address in Oxfordshire and a man in his 20s was arrested at an address in Edinburgh. Searches were also carried out at both the residential properties, as well as at a third address in east London."
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