University of Sydney deputy vice chancellor of research Duncan Ivison said the amended bill,passed by the House of Representatives this week,made clear the legislation was"now very much focused on China."
UNSW Professor George Williams,the deputy vice-chancellor of planning and assurance,said the change would make a"real and significant difference".
"There's no doubt about that,because it moves from a potentially very large,unknowable list of foreign universities being caught to quite a small number. It does seem particularly directed at Chinese universities,"Professor Williams said.
Universities have pushed back strongly against their inclusion in the bill,which also gives the foreign affairs minister the power to cancel agreements that states,territories,local governments and universities enter into with foreign governments if they contradict Australia's national interest.
It is destined to become law,with Labor agreeing to support the bill when it comes before the Senate but it has flagged it will seek to make further amendments. Government MPs defended the inclusion of universities in the bill as the proposed laws were debated in the parliament this week.
"It's concerning that many universities are concerned about their institutional autonomy in relation to the way their own government will have oversight of a very small and distinct aspect of their work,when their real concern should be around the risk of their campuses being used for foreign interference,"Liberal backbencher Julian Leeser said.