A split has emerged in the British government on managing its cooling relations with China, The Sunday Times newspaper said, citing sources.
Prime Minister David Cameron and finance minister George Osborne are keen to avoid raising tension with Beijing due to concerns that escalating hostility could damage trade ties.
However, Foreign Secretary William Hague believes Britain must not tone down its criticism of human rights abuses, while Deputy PM Nick Clegg insists Britain must take a principled stand on issues such as the treatment of people in Tibet, the newspaper said.
"Hague and Clegg are on the same side on this issue. They believe we need to stand up to the Chinese," a government ministry source was quoted as saying.
"For Clegg, human rights are a matter of principle. For Hague, it's about not kowtowing to the Chinese. He believes we need to stand up to them, or they will simply treat us with contempt.
"Cameron and Osborne are focused on trade. They want to keep the Chinese on side."
Britain is keen to attract Chinese investment in infrastructure projects to boost the economy.
However, relations between London and Beijing have deteriorated in the last nine months, with security services reporting a rise in Chinese cyber-espionage, The Sunday Times said. The Foreign Office declined to comment.
But an insider at the ministry was quoted as saying Beijing's behaviour towards London had grown "quite childish" following Cameron's meeting in London with Tibetan spiritual leader the Dalai Lama last year.
Although Britain views Tibet as part of China, the meeting sparked an official protest from Beijing, which views the Buddhist monk as a dangerous separatist.
"They like trying to wind us up by sending diplomats to Edinburgh and Dublin, but not to London," he said.