ndia and China are two republics that have experienced very opposing political regimes throughout history. China has been fundamentally stable country with a lack of a distinct authority figure (Desai, 2003). Being a single party state China has been controlled by the Chinese Communist Party since the 5th National Congress held in 1927 (Wang, 2013). Correspondingly India, have always been a federal parliamentary democratic republic where the President of India elected is head of state and the Prime Minister elected is the head of government (U.S. Central Intelligence Agency, 2013). This essay will reflect on the political views of both China and India, and attempt to determine why it is more advantageous to do business in India.

Government regulation is the process of dissemination, monitoring and enforcement of policy established by appropriate legislation. In, China regulation is central as particular industries are not accessible to foreign investors as the Communist Party aims to restrict external influences on its own population (Desai, 2003). An estimated 90 percent of companies listed on the Chinese exchanges are either partly or fully state-owned (Desai). Retaining a level competition base is significantly reduced, as the chances of competing against a government owned company is more than likely.
A good example of policy that has restricted and reduced foreign investment is China’s severe censorship regulations. The Communist Party of China’s censorship policies have direct implications on the external media industry; ultimately restricting their communication with the public and therefore any communication with a potential customer base.

In contrast, India’s government experiences weakness in the regulatory environment. India pertains a “fractious democracy and inept governance” in