Business Environment - China vs India'For Australian businesses looking to expand their operations overseas, China is a more attractive location than India.' To what extent do you agree with this statement? Justify your answer.IntroductionIn 2007, China and India ranked first and second respectively in the list of ideal destinations for foreign direct investment (FDI), according to AT Kearney, a global strategic management consultancy (The Press Trust of India Limited, 2007a ). The two nations, due to their similarities in geopolitical, economic and demographic aspects, are often compared with each other. To determine which is more attractive for businesses to expand, this essay will examine the business environment of both countries from the following perspectives: political/legal, economic, socio-cultural, and technological. Political/Legal China and India both have ponderous bureaucratic systems. created by history and tradition. Since the opening of the Chinese market to foreign investors in 1978 and India in 1991, these countries have gradually moved from a centrally planned economic system towards decentralization. However, in addition to ongoing movements to provide businesses with a better environment, significant problems still exist. Realizing that foreign investment is the main source of the nation's economic growth, the Chinese government has granted special preferences to foreign investors (Financial Express, 2006). ). This is mainly done through the reduction of the most favored nation (MFN) tariff duty. In India, however, there is fair competition between domestic and foreign investors. Although the Indian government claims to want to reduce the MFN tariff rate, which currently doubles that of China, to the levels of other ASEAN countries, this is actually a major challenge because much of the nation's tax revenue comes from customs tariffs (Henley, 2004).