Boris Johnson has claimed other Western countries would "happily supply arms" to Saudi Arabia without the same protections should Britain suspend its sales.
The Foreign Secretary warned that suspending arms sales would "at a stroke" eliminate Britain's diplomatic influence on the Yemen conflict, in which the Saudi Arabian-led coalition has been accused of war crimes.
Labour and the SNP have called for an independent UN-led investigation into the allegations, while there have also been calls for Britain to suspend arms sales to Saudi Arabia while investigations take place.
Speaking in an opposition day debate on the crisis in Yemen, Mr Johnson said it was right that Saudi Arabia did its own investigation first - and resisted calls to suspend arms sales.
He told the Commons: "The Saudi government has approached this matter with great seriousness, and the seriousness it deserves.
"But the House should be in no doubt that we in this country are monitoring the situation minutely and meticulously, and will continue to apply our established criteria for granting licences with fairness and rigour, and in full accordance with UK law."
He added: "To those who say, as apparently they now do in this motion, that we should simply disregard those legal procedures, be in no doubt that we would be vacating a space that would rapidly be filled by other Western countries who would happily supply arms with nothing like the same compunctions or criteria or respect for humanitarian law.
"And more importantly, we would at a stroke eliminate this country's positive ability to exercise our moderating, diplomatic and political influence on a crisis where there are massive UK interests at stake."
Mr Johnson also claimed shadow foreign secretary Emily Thornberry "substantially retreated" from the Opposition's motion, specifically over whether to suspend weapons sales.
He said: "Under questioning ... as to whether or not she would support the immediate suspension of arms sales to Saudi Arabia and the Saudi Arabian-led coalition forces, as is specified in this motion in her name, she refused to say that she would.
"I think that she was very wise."
Ms Thornberry, intervening, noted the motion calls on the Government to suspend its support to the coalition until it has been determined whether they have been responsible for violations of international humanitarian law.
Labour is facing opposition from its own MPs about its motion, with Labour's John Woodcock (Barrow and Furness) insisting Britain's involvement in the coalition must continue.
He suggested the withdrawal of support could lead to further civilian deaths in Yemen.
Mr Woodcock, intervening, told Ms Thornberry: "I agree with your calls for an independent investigation into this matter.
"Can you explain to me though why you feel that actually withdrawing the UK's support to the coalition - which is precisely focused on training Saudis to better able to be in compliance with international humanitarian law, therefore our interventions, if they are effective, will create fewer civilian casualties - why you have insisted, despite a number of us asking, in keeping that in the motion making it very hard for many of us to vote for it?"
Ms Thornberry quoted Californian congressman Ted Lieu, in which he questioned if Saudi Arabia was either not listening to the US or did not care.
She later said there are major questions about the coalition's command structure.
Ms Thornberry explained: "All sides will have spoken to experts on the conflict who say there is essentially two coalition forces operating in Yemen.
"One, from the capital which carries out pre-planned operations based on strong intelligence under the direction of the Americans and UK advisers.
"And the other - this answers (Mr Woodcock's) point - there is another centre operating out in southern Saudi Arabia, which carries out dynamic, reactive operations often on the basis of sketchy evidence, often without thinking through the so-called 'collateral damage' and inevitably often with significant civilian casualties.
"Of course, if this is the case that any coalition forces are acting in a reckless or indiscriminate manner when it comes to air strikes in civilian areas, it would itself be a clear violation of international humanitarian law and cause this whole House grave concern."
Ms Thornberry said Foreign Office Minister Tobias Ellwood's explanation of a funeral bombing, which killed more than 140 people, as a "deliberate error" raises the prospect there has been "intentional targeting of civilians by elements of the coalition forces".
She later said: "When we say one thing about Russia and Aleppo but we say another thing about Riyadh and Yemen, what the rest of the world hears is hypocrisy and double standards.
"But today's motion gives us an opportunity to send the opposite message to the world, to show how we hold all countries - friend or foe - to the same high standards that we aspire to ourselves.
"And that while Saudi Arabia will remain a valued strategic security economic ally, our support for their forces in Yemen must be suspended until alleged violations of international humanitarian law in that conflict have been fully and independently investigated, and until the children of Yemen have received the humanitarian aid they so desperately need."
The SNP's Tasmina Ahmed-Sheikh (Ochil and South Perthshire) pressed ministers to back an independent inquiry, telling the Commons: "I simply cannot understand, though, why the Government is so averse to an independent UN-led inquiry into what is happening."
She added: "Do they really believe the assurances given to them by the Saudis? Has this Government really not properly investigated these claims by the Saudis?
"It matters, because when the UK is presented with serious and widespread evidence of breaches of international law, we simply cannot take the words of those who are accused of it for granted."
Ms Ahmed-Sheikh said the SNP recommended suspending arms sales to Saudi Arabia, pending the results of any independent inquiry.
However, Tory MP Crispin Blunt, chairman of the Foreign Affairs Select Committee, backed the Government's stance.
He said: "It is a standard factor of normal international practice in these areas that the Saudis should be given the opportunity, and it's an established principle for them, to investigate these incidents in the first instance."
Mr Blunt went on to say that Britain had "the toughest set of conditions around arms licence conditions", adding: "The proper place for those laws to be tested is in a court, and that is what is going to happen."
He added: "I would argue that it is in our interest, as far as this operation in the Yemen is concerned, is to give as much support as possible to the Saudi coalition, who are in effect doing it on our behalf, in order for them to conduct this operation within the grounds of international humanitarian law, and to progress it successfully."
Former chair of the home affairs committee Keith Vaz, who was born in Yemen, suggested MPs efforts should be concentrated on achieving a ceasefire in the war zone, instead of the being divided over the Labour motion.
"I'm sorry that we are going to divide on this subject," he said.
"Unless we have that permanent ceasefire this country will quite literally bleed to death while we discuss these issues.
"So I beg everyone involved in this process to please move together in a united way, without dividing opinion, concentrating on that one critical issue"
Labour's former shadow defence minister Toby Perkins said he would not support the frontbench motion, which he complained was not clear enough.
He said: "There is much in this motion that I agree with but I do fear that it is ultimately undermined by the abandonment of our commitment to the UN Security Council resolution.
"I feel that while it might make us feel better, it is not what will make the situation on the ground better."
Referring to Ms Thornberry's speech, he said: "I wasn't certain what it was we were actually saying was the support that we were intending to withdraw.
"It clearly isn't arms exports. I wouldn't be certain if I was supporting this motion what exactly it was I was supporting."
Nadhim Zahawi, the Tory MP for Stratford-on-Avon, labelled calls for the UK to withdraw support for the coalition as "ludicrous".
He said: "It could not be clearer that without Saudi military aid the situation would have been far worse.
"Time and again Saudi Arabia has proven to be a crucial ally to the United Kingdom."
Stephen Twigg, the chair of the Commons International Development Select Committee, said "appalling atrocities have been committed by both sides to the conflict".
However, he said: "There are very widespread reports of violations of international humanitarian law.
"The UN expert panel documented 119 such cases. Both Amnesty International and Human Rights Watch have documented substantial numbers of cases.
"The Government, I think, have been rather dismissive of the evidence from those organisations."
Tory Daniel Kawczynski (Shrewsbury and Atcham) rejected any suggestion that Saudi-led forces had deliberately targeted civilians.
"They are doing everything possible to try to limit civilian casualties," he said.
Meanwhile, Mark Menzies, the Conservative MP for Fylde, defended the UK's right to sell arms legitimately and with export controls to Saudi Arabia as he suggested stopping sales would lead to job losses.
He said: "It is all very well sitting as though you were at an Islington dinner party over your latest glass of wine talking about 'let's stop arm sales'.
"Well, let's look at one key fact here: every single person is not a number, it's a human being, they have mortgages to pay, they have skills, they have jobs."
He added: "When I see people in this House tabling motions calling for them to lose their jobs I question their moral judgments because that is what is happening."
Earlier in Prime Minister's Questions, Labour leader Jeremy Corbyn pressed Theresa May over whether the UK would again back Saudi Arabia for membership of the United Nations Human Rights Council, amid warnings it has "violated international law" by its bombing of Yemen.
Mrs May replied: "As you know, where there are legitimate human rights concerns in relation to Saudi Arabia, we raise them.
"In relation to the action in the Yemen, we have been clear that we want the incidents that have been referred to properly investigated, and if there are lessons to be learned from them, we want the Saudi Arabians to learn those lessons.
"I reiterate a point that I have made in this House before - our relationship with Saudi Arabia is an important one.
"It is particularly important in relation to the security of this country, to counter-terrorism and to foiling the activities of those who wish to do harm to our citizens here in the UK."
MPs voted 283 to 193, majority 90, to reject Labour's motion, while the Government amendment to the motion was agreed unopposed.
Amnesty International UK's arms control director Oliver Sprague accused Mr Johnson of "making a mockery of the whole arms control process".
He said: "As Mr Johnson surely knows, the UK Government is in breach of a legal duty to suspend arms exports where there's a clear risk of UK weaponry being used to commit human rights violations. Day in day out, mounting evidence has shown this clearly to be the case with Saudi Arabia's reckless conduct in Yemen.
"After the Saudi Arabia-led coalition's appalling attacks on homes, hospitals and funeral halls in Yemen, no country - Britain or anyone else - should be selling weapons to Saudi Arabia or any of the other coalition countries."
Labour leader Jeremy Corbyn called for an inquiry into arms sales to Yemen.
He told the Press Association: "What has to happen now is an investigation into the sales that have taken place. An investigation into humanitarian issues in Yemen, of what Saudi Arabia has actually done, and allow the UN to undertake that investigation, and as a sign that we are serious about this, we do not support Saudi Arabia for being a member of the UN Human Rights Council."
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