Boris Johnson admitted the Northern Ireland Protocol does not “command the confidence” of a significant of number of people in the country.
It follows reports that ministers are preparing legislation which would give them sweeping powers to tear up the protocol in the Withdrawal Agreement.
Unionist parties in the region have consistently declared their opposition to the protocol, which they argue cuts the area off from the rest of the UK.
Speaking at a press conference in India, Mr Johnson said: “This is something that has been a consistent issue for for the UK Government.
”I think it’s very simple. It’s about the balance of the Good Friday Agreement. I think that it’d be fair to say that the protocol really does not command the confidence of a large component of the population in Northern Ireland.
“We have to address that, we have to fix that and the very substantial diversions of trade and it’s going on and it’s getting more acute.
“I’ve said many times now we don’t rule out taking further steps, if that’s necessary.”
Northern Ireland minister Conor Burns refused to be drawn on the report by the Financial Times that ministers are preparing legislation to change the protocol.
Mr Burns said it is clear the arrangements are not working in the intended way and the Government has powers under Article 16 of the protocol allowing it to suspend parts of it.
He told LBC radio: “As far back as last July the Prime Minister said that we believed that the threshold for triggering Article 16 of the Northern Ireland Protocol had been reached.
“There is significant societal disruption in Northern Ireland due to the way that the protocol is being implemented.
“I hope Brussels are listening to this conversation and other conversations. I hope they will come back to the table constructively to allow us to change the protocol to make it work in the way it was intended.”
Labour’s Peter Kyle described reports as “absolutely astonishing and incredibly damaging”, and questioned how Mr Johnson can negotiate a trade deal with Indian Prime Minister Narendra Modi at the same time.
The shadow Northern Ireland secretary told Sky News: “This is absolutely astonishing and incredibly damaging.
“Boris Johnson negotiated, his team drafted the Northern Ireland Protocol; they presented it to the EU, they negotiated it into the deal.
“It doesn’t work as well as it can do, that’s why the Labour policy is, you build on it – we can improve the protocol, we can smooth it, and we can do so without breaking the law and breaking our international treaty we signed with the EU.
“If we just recklessly pull out of it unilaterally, how will any other country in the world sign a deal with us and think that we will honour it?
“How will Prime Minister Modi react today when Boris Johnson asks for a trade deal if he is pulling out unilaterally of the last trade deal he signed?”