It would be hard to dream up a more absurd piece of political satire than an agency of the British government called Just Solutions International winning a contract to train prison officers in a country that has executed 175 people in the past year, many of them in public beheadings for offences such as sorcery, witchcraft, adultery and political activism. That it sought this contract in the first place is a sign of the great void at the heart of our foreign policy.

This week, the Justice Secretary, Michael Gove, pulled out of the deal with Saudi Arabia — thereby attracting the ire of the Foreign Secretary, Philip Hammond, who called him ‘naive’ for doing so. That is a word better applied to Mr Hammond. A Saudi Supreme Court ruling dating from February decrees that judges may pass down the death sentence even if an offence has not been proved beyond reasonable doubt. How could Hammond lecture other countries on human rights if Britain were to collude with this medieval penal system?

Saudi Arabia is no friend of Britain. The country not only encourages but exports the Islamic extremism we are having to confront at home and abroad. That said, no government can divorce itself from history, and our policy in the region must be based on a hard-headed assessment of the available options. Although Michael Gove is quite right to refuse to co-operate with the Saudi penal system, it is equally right that the government should continue to co-operate with the country because of our mutual defence interests. The country may not be a friend of Britain’s, but it is an ally. For all its faults, Saudi Arabia is not an aggressive, expansionist nation. Surrounded by more belligerent regimes, it is an important counterbalance against the growing aggression of Iran.

Charles Moore, in the second volume of his superb biography of Margaret Thatcher, describes how keen Thatcher was to sell aircraft to the Saudi air force. This makes sense: arms sales are the iron of diplomacy, and nations ought to co-operate with their allies. The Saudis would not use RAF Tornados to oppress their own people — they have the justice system for that. This is where we should draw the line: if they are going to behead Shiite protesters, they do not need to do so with British steel.

An absolutist moral stance on foreign policy is impossible to achieve, as the late Robin Cook quickly discovered with his disastrous ‘ethical foreign policy’. When a dictator declares war on his own people, is the moral response to invade, remove him and try to rebuild the state as a democracy; to arm and assist rebels who are seeking to overthrow him; or to keep out of it altogether? In the past decade and a half we have tried all of these approaches, in Iraq, Libya and Syria — and as we have seen, there is no right answer. Sweeping out a dictator too often hands power to fundamentalists.

It is naive to think that we can remake countries in our own image. We might, through sanction or influence, win some battles over human rights, but it is arrogance to think we can impose democracy in countries that have never known it. A great error was made during the War on Terror when it was assumed that history was moving our way and that, with a nudge, the Arab world would embrace western-style democracy. As we have seen in Iraq and Libya, the momentum is with Islamists, who stand ready to fill any power vacuum.

Next week, we will witness a spectacle which is almost more embarrassing than any contract with Saudi Arabia. To compound the horror, it is one in which the Queen has been commandeered to play a role. The Chinese President Xi Jinping will be given a state banquet at Buckingham Palace and invited to Parliament. According to those with knowledge of the arrangements, the visit is likely to resemble the reception of Queen Victoria as Empress of India.

Would such hospitality be afforded to the leader of a communist superpower if our government were not so hungry for Chinese cash to fund George Osborne’s pet projects? It is worth noting that even the Saudis were being groomed for possible investment in the disastrous Hinkley Point C nuclear power project. When Xi visited the United States, the Obama administration made sure that he was confronted with difficult questions — not just about human rights, but about the regular cyber-attacks made by Chinese hackers on western companies. Osborne has a different agenda: to present Britain as China’s most sycophantic friend. In his mind this advances British interests, because he thinks money will flow.

An ethical foreign policy always was pie in the sky, but it is unedifying to see our diplomats turned into salesmen, and foreign policy effectively auctioned off to the -highest bidder. Our relationship with China has become a fawning one, completely at odds with the lectures on human rights that we give to other, less economically powerful dictator states. If Michael Gove has this week demonstrated a more questioning attitude to our relations with unsavoury regimes, that is much to be welcomed.