Deputy Prime Minister Oliver Dowden raised allegations that Saudi Arabia authorised the use of lethal force to clear land for a new desert city during talks with the Riyadh government.
Mr Dowden, Business Secretary Kemi Badenoch and Culture Secretary Lucy Frazer are in the Gulf state for a two-day summit aimed at bolstering economic ties against a backdrop of human rights abuse accusations.
The BBC reported claims last week that Saudi forces had been permitted to use deadly force to clear land for a multibillion-pound desert city being built by dozens of western companies.
Villagers were reportedly evicted to make way for The Line, a 105-mile-long metropolis in the kingdom’s eco-region of Neom, with one person subsequently shot and killed for protesting, according to the broadcaster.
Downing Street confirmed Mr Dowden had raised the subject during his visit.
Prime Minister Rishi Sunak’s official spokesman said: “We obviously have a vital national security and economic security relationship with Saudi Arabia, but no aspect of our relationship prevents us from speaking frankly to them about these sorts of issues.
“My understanding is the Deputy Prime Minister has raised the issue of the treatment of villagers in the construction of the Neom project in his bilateral meetings while he has been out on this visit.”
The spokesman said United Nations experts had looked at the project and “we will obviously look at that report and consider any response”.
The UK-Saudi event this week, dubbed Great Futures, is aimed at promoting British business interests in Riyadh’s Vision 2030 strategy, which includes Neom and is designed to diversify the country’s economy away from oil.
Dozens of companies from across the world, some of them British, are involved in the construction of the eco-region.
Campaigners have criticised the visit, citing the poor human rights record in Saudi Arabia, and called on the UK delegation to push for an independent investigation into the circumstances of the reported killing.
Amnesty International warned that businesses have a responsibility to assess the risks before operating in Saudi Arabia, saying: “The reality behind such futuristic projects is the brutal repression of citizens and residents.”
But in a keynote speech at the summit on Tuesday, Culture Secretary Ms Frazer hailed “a new chapter in British-Saudi relations”.
“One defined by security and prosperity, by cooperation and collaboration the exchange of knowledge, ideas and investment,” she said.
Referring to the Vision 2030 strategy, the Cabinet minister said: “Our two countries have always found common ground in spheres such as international development and security cooperation, but it is clear today – in 2024 – that there are huge new opportunities available to us both.
“Days like this really underscore the immense cultural and creative ambitions of the Kingdom in its Vision 2030.
“That vision is bold, it is ambitious and I am here today because I believe Britain can play a role in that story.”