A group of coalition backbenchers has broken ranks to demand urgent action on a critical port leased by a Chinese company.
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The Port of Newcastle is half-owned by China Merchants Port Holdings.
A group of MPs including Liberal senator Eric Abetz fear the company could use its powers to exploit coal exporters.
They want to introduce tougher regulations to guard against punitive costs.
"We need to protect our coal exporters," Senator Abetz told 2GB radio on Monday.
"Within the communist dictatorship, civil companies are subject to the dictates of the regime."
The politicians have signed and sent a joint letter to the prime minister and treasurer calling for action.
Scott Morrison said the National Competition Council had reviewed the Newcastle port lease on many occasions and provided advice to the government.
He said critical infrastructure laws were in place that gave the home affairs minister powers to demand action from the port.
"Those sort of decisions have got to be made based on evidence and where there's evidence to support those actions then the government would certainly take them," he said.
Barnaby Joyce is likely to push for a tougher line on China after being returned as deputy prime minister.
Mr Joyce said the Nationals had a strong track record on investment from China.
"The Nationals as a party brought about some of the most substantial changes in foreign investment laws when everyone was calling us bigots and everything under the sun," he told reporters in Canberra.
"Now they just call us correct."
The prime minister has returned to Australia after travelling to Europe for the G7 summit, where he courted support for Australia in its diplomatic and trade battle with China.
Mr Morrison said Australia had important partners and allies but could not take them for granted.
"There are a lot of countries prepared to stand with us when our interests are under any pressure," he said.
Mr Morrison shared with other world leaders a list of complaints China issued about Australia, which included issues around foreign interference and freedom of the press.
"This just served to highlight what this is really all about and why we need to be able to stand up for those things and find practical ways to work together," he said.
China has launched trade strikes against more than $20 billion worth of Australian exports in response to a range of grievances, including the prime minister's call for an investigation into the origins of COVID-19.
Other world leaders are now calling for a fresh inquiry into how the pandemic began, with a particular focus on the possibility the virus might have spread from a Chinese lab.
"We'll find out what the facts are," Mr Morrison said.
"I don't sort of have a particular view about which (cause) it is. I'm happy for the evidence to decide that."
Leaders at the G7 also spoke of the need for an early warning system to better respond to future outbreaks.
Australian Associated Press
