The Morrison government's approval of a $1.5 billion Chinese takeover of an Australian company has reignited calls for a far-reaching inquiry into Beijing's influence amid claims of "manipulation" to slash the firm's value.

The government is being urged to rethink its decision to approve the sale of organic infant formula producer Bellamy's to China Mengniu Dairy Company after months of uncertainty over the company's access to the vast Chinese market.

"I think there has been a blatant manipulation of the market to drive the price of Bellamy's down," Tasmanian independent MP Andrew Wilkie said. Credit:Alex Ellinghausen

Senate crossbenchers are demanding an inquiry into relations with China, including its military expansion and foreign investment, while some question whether Chinese officials and investors undermined Bellamy's to buy the company at a bargain price.

"I think there has been a blatant manipulation of the market to drive the price of Bellamy's down," Tasmanian independent MP Andrew Wilkie said. "It is a striking example of the closeness of the relationship between the Chinese government and so-called private enterprise in China."