The head of Australia's domestic spy agency has rejected allegations that it is targeting the Chinese community in the wake of the Huang Xiangmo controversy.

Key points: The Department of Home Affairs stripped billionaire Huang Xiangmo's permanent residency status

The Department of Home Affairs stripped billionaire Huang Xiangmo's permanent residency status Chinese language newspapers and Chinese community groups condemned the decision

Chinese language newspapers and Chinese community groups condemned the decision ASIO tried to assure Chinese Australians they have nothing to fear from security agencies

The Department of Home Affairs stripped Mr Huang of his permanent residency while he was overseas. Security agencies were concerned about the billionaire's links with the Chinese Communist Party, and had warned political parties about accepting donations from him.

But the decision to effectively bar Mr Huang has stirred unease in parts of Australia's Chinese community.

Three large Chinese language newspapers in Australia published identical letters defending Mr Huang and attacking intelligence agencies.

The letter was signed by more than 100 community groups.

"What happened to Mr Huang Xiangmo today may happen to any of us tomorrow," the statement read.

"If we do not defend Huang Xiangmo's legitimate rights and interests today, no one will be able to defend our legitimate rights and interests tomorrow.

"We strongly protest against that Mr Huang has been deprived of his permanent residence visa for false charges by relevant intelligence agencies.

"The unfair treatment suffered by Mr Huang has dealt a heavy blow to the legitimate political participation of people from Chinese or other ethnic minorities. It made the underprivileged people from the Chinese community and other ethnic minorities even more vulnerable."

One Chinese community group supported Mr Huang's (second from left) ousting, saying Australia must "reject the virus of corruption". ( Supplied: Yuhu website )

However, the Australian Values Alliance — a group also from the Australian Chinese community — made a statement showing support for the Australian Government's decision.

The statement said it was "a new step in the right direction" for Australia to "reject the virus of corruption" — referring to Mr Huang's involvement in political donations before his visa got cancelled.

'It's critical that we avoid commentary that will instil fear'

ASIO director-general of security, Duncan Lewis, told a senate estimates committee that the attacks on his organisation were inaccurate.

"I am concerned at reporting in Australian, in foreign, and in foreign-language newspapers over this weekend, wrongly asserting that the Chinese community is a target for ASIO," Major General Lewis said.

"This is simply not so ... ASIO does not investigate people based on their ethnicity, religion or cultural background."

But Major General Lewis tried to reassure Chinese Australians that they had nothing to fear from security agencies.

"It's critical that we avoid commentary that will instil fear and taint such a community which makes such a positive contribution to Australian life, our economy and our culture," he said.

"And as the DG of security I can say categorically that from a security point of view the overwhelming majority of people of Chinese heritage are of no investigative interest to ASIO as they are of no security concern. We should not impugn the many for the actions of a few."

Major General Lewis also issued a broader warning about the challenge posed by foreign interference.

"The current scale of foreign intelligence activity against Australian interests is unprecedented," he told the committee.

"Hostile intelligence activity poses a real and existential threat to Australian security and sovereignty."