The much-anticipated Australia-India Test series begins on December 17 in Adelaide.
Laxman feels performance in Adelaide's D/N pink-ball encounter will set the tone for the rest of the series as Indians strive to retain the prestigious Border-Gavaskar Trophy.
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"India can derive confidence from their series win last time around and the brand of cricket they have showcased, but Adelaide offers a unique challenge in that it will be their first pink-ball Test overseas," Laxman wrote in his column for The Times of India.
"Their (India's) only previous day-night Test was in Kolkata more than a year back, where they were barely tested by Bangladesh. Australia, with greater exposure to this innovation, will be a much tougher opposition; but this Indian side has what it takes to rise to the occasion and compete."
"How India starts the first day of the series, be it with bat or ball, will set the tone for what will follow, especially with Virat Kohli returning home after this match," he added.
Sticking to that point, Laxman batted for a left-field selection at the top of the order. He wants KL Rahul to feature as an opener alongside Mayank Agarwal, not Prithvi Shaw or Shubman Gill who both took part in the two pre-series warm-up games.
"That’s one of the reasons why I’d like to see KL Rahul partner Mayank Agarwal at the top."
"Rahul has been in great touch, admittedly in different formats; but he has experience of having played and savoured Test success in Australia previously."
"It’s imperative to have a stable, steady opening pair against a high-class pace attack, though I’m not sure if he figures in the team management’s plans."
Further on selection, he picked Umesh Yadav as the third paceman and confirmed preference for Ravindra Jadeja as the lone spinner if the left-armer recovers from hamstring injury and concussion scare.
"India’s bowlers were outstanding two years back, and boast great pace riches in (Jasprit) Bumrah, (Mohammed) Shami and Umesh Yadav. If Ravindra Jadeja is fit, I’d want him to be the lone spinner to complement them and tie up one end."
Laxman, who reserved his best for tours down under during his playing days, reckons "adaptability" and "mental adjustments" are key to succeeding in Australia.
"In Australia, your experience and skill-set alone aren’t sufficient. You need to be mentally tough and positive. The sudden switch in formats will test their (India's) adaptability."
"The sooner they make the mandatory mental adjustments, the better their chances of staying in touch with a formidable home side," he signed off.