The Foreign Relations Bill would give the Foreign Minister veto over agreements that state,territory and local governments and universities sign with foreign governments if they contradict Australia's foreign policy.
Senator Abetz's questioning of a number of Chinese-Australians occurred at a hearing of an inquiry into diaspora communities in Australia last week.
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In a submission to the Senate inquiry into the bill,China's ambassador Cheng Jingye compared Senator Abetz to Joseph Goebbels and said he was hurting the Australia-China relationship.
"I have to point out that your recent assertions on China at the Senate are far off the mark,which have the smack of Goebbels'tricks,"Mr Cheng said.
"It is appalling and outrageous,deserving condemnation.
"It's my hope that you would look at China and our bilateral relationship in an objective and rational manner without tinted lens or bias.