Foreign Minister Julie Bishop strongly denies relations with China are at a low after its Canberra embassy scolded the Australian media and political class.
The embassy lashed out against what it said was a "Cold War mentality", following the Turnbull government's flagged crackdown on foreign interference and earlier resentment about a new foreign policy blueprint.
When asked whether relations with Beijing were at a low, Ms Bishop told reporters in Canberra on Thursday: "The Australian government enjoys a very close, comprehensive, strategic partnership with China".
Ms Bishop said she welcomed China's commitment to ensuring there would not be any illegal interference in Australian political affairs.
She insisted Beijing was deeply concerned by the behaviour of Labor senator Sam Dastyari and his dealings with a Chinese Communist Party linked-businessman.
"But the actions of Senator Sam Dastyari are separate from this," Ms Bishop said.
Opposition foreign affairs spokeswoman Penny Wong is concerned about heightened rhetoric as debate heats up over the proposed legislation.
"It is important that national leaders set the appropriate tone and don't succumb to populism in how they take these matters forward," she told reporters.
The embassy insisted China had no intention of interfering in Australia's internal affairs or exerting influence on its political process through political donations.
But some Australian politicians and government officials had made irresponsible remarks to the detriment of political mutual trust between China and Australia, it said.
As well some media had repeatedly fabricated news stories about the so-called Chinese influence and infiltration in Australia.
"Those reports, which were made up out of thin air and filled with Cold War mentality and ideological bias, reflected typical anti-China hysteria and paranoia," an embassy spokeswoman said.
