Parti Pribumi Bersatu Malaysia (Bersatu) president Muhyiddin Yassin said that as a Johorean, he is loyal to the state's ruler Sultan Ibrahim Sultan Iskandar.

However, the former deputy prime minister emphasised that loyalty must not be blind.

"It must be based on the principle of truth. That is also what is taught in Islam," said the Pagoh lawmaker in a media statement today.

He was responding to Deputy Transport Minister Abdul Aziz Kaprawi, who yesterday challenged Muhyiddin to declare his loyalty to either the Johor ruler or former premier Dr Mahathir Mohamad.

However, Muhyiddin said the issue at hand is not about loyalty but about the country's sovereignty and well-being of the rakyat.

He questioned whether the sale of land to foreign companies was for the benefit of the rakyat, or whether it would be a threat to the country's sovereignty to cede land to foreigners.

"History taught us that colonisation begins with the rulers selling part of their territories to foreign powers. In the end, these territories fell into the hands of outsiders and the state loses its sovereignty.

"This is the experience by the Malay states when the British came to our land with its East India Company. This is also the main question raised by Mahathir, which is very reasonable," he said.

Mahathir had brought up concerns about huge tracts of land around Johor Baru being sold to foreigners with no restrictions, and the possibility of mass immigration to take up residence in these new cities.

Sultan Ibrahim admonished Mahathir for making such claims, adding that he was "deeply offended and hurt" by the latter's comments and accused the former premier of playing racial politics to create fear.

Muhyiddin said some have described the sale of lands to companies from China as foreign investment and accused him of being anti-foreign investment or anti-Chinese when he criticised this policy.

"I know what foreign investment means and I am among those responsible for bringing in foreign investment to Malaysia when I was the international trade and industries minister," he added.

He said foreign investment requires foreigners to invest capital in Malaysia to set up factories, source materials and ingredients for their products from Malaysia or hire local workers.

The government sometimes provide land for foreign companies to set up their factories, he said, but these lands are leased to the companies, who must return the land once the lease expired.

He said such foreign investments bring benefits to Malaysia through job opportunities, transfer of technology and other economic benefits, without losing any land to foreigners.

"What is happening in Forest City is the opposite of this. Foreign companies are not investing capital here, instead, they are buying land to develop and sell.

"The workers are made up of foreigners, mostly from China, and even the building materials are from China. The buyers of the 700,000 units of houses are also mostly Chinese citizens.

"So what is the benefit to the country and to the rakyat other than the revenue made by the companies working with the Chinese companies?" he asked.

Why is it freehold?

Therefore, he argued that the Forest City project was not foreign investment, but the sale of land to foreign companies.

Muhyiddin said when he was deputy prime minister, Putrajaya's policy was that all land sold to foreign investors could not be freehold.

In view of this, he questioned whether Johor did not follow this policy or whether the policy has been changed.

He reiterated that the main issue here is the safety and sovereignty of the country, which Bersatu is trying to defend.

"When the country's sovereignty and the safety of our citizens are threatened, thus as a citizen who is loyal to the ruler and the country, it is my duty to speak up about the truth," he said.