Prime Minister Sunak chastised Communist China’s premier on Sunday for “unacceptable” interference in British democracy, after a newspaper reported that a researcher in parliament was arrested earlier this year on suspicion of spying for Beijing.

Rishi Sunak said he raised the issue with the premier, Li Qiang, when the two met at the Group of 20 parley in India. Mr. Sunak told British broadcasters at New Delhi that he’d expressed “my very strong concerns about any interference in our parliamentary democracy, which is obviously unacceptable.”

The two met after the Metropolitan Police force confirmed that a man in his 20s and a man in his 30s were arrested in March under the Official Secrets Act. Neither has been charged and both were bailed until October pending further inquiries.

A Chinese Embassy statement called the allegations “completely fabricated and nothing but malicious slander.” China urges “relevant parties in the U.K. to stop their anti-China political manipulation,” the statement said.

The Sunday Times reported that the younger man was a parliamentary researcher named Chris Cash who worked with senior lawmakers from the governing Conservatives, including Alicia Kearns, who now heads the powerful Foreign Affairs Committee, and her predecessor in that role, Tom Tugendhat, who is now security minister. The newspaper said the suspect held a pass that allows full access to the parliament buildings, one that is issued to lawmakers, staff, and journalists after security vetting.

Tensions between London and Beijing have risen in recent years over accusations of economic subterfuge, human rights abuses, and Beijing’s crackdown on civil liberties at the former British colony of Hong Kong.

Britain’s Conservatives are divided on how tough a line to take with Beijing and on how much access Chinese firms should have to the British economy. More hawkish Tories want Beijing declared a threat, but Mr. Sunak has referred to China’s growing power as a “challenge.”

A former Conservative leader, Iain Duncan Smith, said news of the March arrests “gives the lie to the government’s attempt not to see China as a systemic threat.”

British spy services have sounded ever-louder warnings about Beijing’s covert activities. In November, the head of the MI5 domestic intelligence agency, Ken McCallum, said “the activities of the Chinese Communist Party pose the most game-changing strategic challenge to the U.K.” The foreign intelligence chief, Richard Moore of MI6, said in July that China was his agency’s “single most important strategic focus.”

In January 2022, MI5 issued a rare public alert, saying a London-based lawyer was trying to “covertly interfere in U.K. politics” on behalf of the Chinese Communist Party. It alleged attorney Christine Lee was acting in coordination with the Communist Chinese ruling party’s United Front Work Department, an organization known to exert Chinese influence abroad.

An opposition Labor Party lawmaker, Barry Gardiner, received more than $685,000 from Ms. Lee between 2015 and 2020, mostly for office costs, and her son worked in Mr. Gardiner’s office. Ms. Lee and the Chinese government both deny wrongdoing.

Beijing has repeatedly criticized what it calls British interference in its internal affairs and denied meddling in the politics of foreign nations.

Messrs. Sunak and Li met days after Foreign Secretary James Cleverly visited Beijing, the highest-level trip by a British politician to China for several years. The Chinese president did not attend the G20 meeting in India.

Mr. Sunak defended his approach of cautious engagement, saying, “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.”