 When the Federation of Malaya , together with North Borneo , Sarawak and Singapore formed the Federation of Malaysia in 1963 , Johor Bahru continued as the state capital and more development was carried out , with the town 's expansion and the construction of more new townships and industrial estates . The Indonesian confrontation did not directly affect Johor Bahru as the main Indonesian landing point in Johor was in Labis . There is only one active Indonesian spy organisation in the town , known as Gerakan Ekonomi Melayu Indonesia ( GEMI ) . They frequently engaged with the Indonesian communities living there to contribute information for Indonesian commandos until the bombing of the MacDonald House in Singapore in 1965 . By the early 1990s , the town had considerably expanded in size , and was officially granted a city status on 1 January 1994 . Johor Bahru City Council was formed and the city 's current main square , Dataran Bandaraya Johor Bahru , was constructed to commemorate the event . A central business district was developed in the centre of the city from the mid @-@ 1990s in the area around Wong Ah Fook Street and the Johor – Singapore Causeway . The state and federal government channelled considerable funds for the development of the city — particularly more so after 2006 , when the Iskandar Malaysia was formed . 
