Australia's Prime Minister Abbott speaks during session of World Economic Forum in Davos
Australia's Prime Minister Tony Abbott speaks during a session at the annual meeting of the World Economic Forum (WEF) in Davos January 23, 2014. REUTERS/Ruben Sprich

Australia Prime Minister Tony Abbott has strengthened the country's terror laws and rejected reforms to the Racial Discrimination Act. Mr Abbott has required all telecommunications providers to retain customer data as federal law tightens to crack down on those who encouraged or incited terrorism.

The move is part of the government's plans to reform counter-terrorism laws. The prime minister said he was dumping the proposed changes to the Racial Discrimination Act and ban Australians from travelling to certain parts of the world.

The prime minister also plans on reducing the "legal threshold" for authorities to arrest suspected terrorists and respond quickly to terror threats. Other plans including cancelling passports so suspected terrorists cannot escape the country or return home.

The changes to terror laws are a response to the threat made by Australians who are training and fighting with terrorist and extremist groups in the Middle East.

One of the Australians fighting alongside extremists is Khaled Sharrouf who has sent a statement to Fairfax Media with details of his "terror" plans. Federal police have recently issued a warrant for his arrest. Upon learning that he is now a wanted man, Sharrouf said he would have launched a terrorist attack on his homeland if he did not leave for the Middle East in 2013.

In his statement, the suspected Australian terrorist demanded the release of 12 Muslim prisoners, including five convicts guilty of planning a terror attack in Sydney.

Meanwhile, the ethnic minority groups in Australia welcomed the Abbott government's turnaround in the proposed amendment to the racial discrimination laws.

The Abbott government has previously announced a draft of its proposed legislation on March 25 to replace racial discrimination laws which have been in place for nearly two decades and used by the Executive Council of Australian Jewry. Under the federal government's proposed changes, the new Racial Discrimination Act will no longer make it illegal to "offend, insult or humiliate" an Australian because of their race or ethnicity.

Yin Paredies from Deakin University said weakening the Racial Discrimination Act will create an environment in which people will begin to think it's alright to be a racist.

Greens acting leader Adam Bandt praised the move as a victory for everyone who stands against racism.