Since the beginning of this millennium both India and China are recognized all over the world as two emerging economies. Both of them are members of the WTO and considered as two major competing players for textile and garments (T&G) products. Over the last 18 years the share of India’s T&G export in the world market has gone up from 2.87 to 4.14 % and during the same period the increase experienced by China is from 12.97 to 39.08 %. In general China reveals stronger comparative advantage compared to India in almost all component groups of T&G and the situation has not altered much after the abolition of MFA in 2005. It has been shown in the analysis that in the international platform there is no definite evidence of China receiving any favorable treatment in terms of market access to explain this performance differential. So, the root cause has been searched in the domestic policies that shape the structure of the industry and influence its performance through creating incentives for different types of conducts. While India is specializing in the relatively high-value products in her niche markets, China is entering in large scale in all varieties of T&G products in both traditional as well as newly explored markets. It is seen that while Chinese T&G sector is expanding by capitalizing the economies of large-scale production, the market served by India relies mostly on its scope economy. © Springer India 2016.