In your meetings with regulators how often have you seen the "we'll exit the market" bluff actually work? I can't see many companies wilfully exiting the third largest market in the world.
It's a way to make the point that "since these foreigners are so ungrateful, we will stop blessing them with our wonderful products if they don't please us, and then they will have to live in the mud and the cold like they used to do before, without an iPhone or a Twitter account".