Prime Minister Tony Abbott on Thursday unveiled his long anticipated vision for developing northern Australia, releasing a white paper that sets out plans to make the north an "economic powerhouse" over the next 20 years.

As part of the plan the federal government has been keen to open up land for farming in northern Australia as part of plans to help feed China's more than 1.3 billion citizens.

However Trade Minister Andrew Robb has played down the concept of the "food bowl" given Australia's current output can supply around 60 million people outside Australia, though he insists northern Australia can be a key supplier to China.

The $1.2 billion plan includes new roads, dam site studies and changes to land use laws and includes a $600 million roads package, airstrip upgrades, funds to explore the best freight options.

The package complements a $100 million beef roads fund and a $5 billion concessional loan facility announced in the budget.

A $200 million water infrastructure fund will also be set up and river systems will be examined to see if they can support dams and storage options.

"We will drive down the costs of operating in the north for business; making it a more attractive place to invest and work," Mr Abbott said.

"By making the right regulations and infrastructure investments we can encourage jobs and tackle the costs of living far from major cities," he added.


But the food bowl push could ignite sensititives among the Australian public over levels of Chinese investment in Australia with a recent Lowy Institute of International Affairs poll of 1200 people showing 70 per cent believed there was too much investment in housing.

However in the same poll China's rating as a military threat dropped from 48 per cent to 39 per cent despite rising tensions between the US and China over South and East China Sea maritime disputes.

Mr Wang said the relaxation of the threshold at which Australia's Foreign Investment Review Board scrutinised Chinese private sector investment would also help its private sector firms.

Under the deal the threshold triggering FIRB scrutiny has been lifted to $1 billion.

Mr Wang also suggested the number of Chinese tourists which now number up to one million a year was also likely to increase and the deal makes it easier to service this sector.

Mr Wang said some of the categories of workers who might benefit from the deal and come from China to Australia some of which would be associated with increased tourist numbers included Chinese chefs, traditional Chinese medicine practitioners.