Davos 2025: US Exceptionalism To Benefit India, But Can't Underestimate China: Citi's Viswas Raghavan

The United States' exceptionalism, as evident with the upturn seen in its economy and equity markets, is expected to continue for a significant period to come, said Viswas Raghavan, the head of banking at Citigroup.

The dominance of the dollar, and the US being at the forefront of the AI revolution, points to the fact that "US exceptionalism will continue," Raghavan said while speaking to NDTV Profit on the sidelines of the World Economic Forum in Davos on Wednesday.

The US dollar as the reserve currency of the world is nowhere close to getting demolished, the veteran banker added.

"I would think Indian progress is symbiotic with the US, from a commercial business point of view," Raghavan said, pointing to the fact that Apple Inc., the US-based tech giant, has started manufacturing in India.

"If the US grows, then it will benefit India. And also, India will grow organically in terms of domestic manufacturing," he added. Fundamentally, investors are buying the India story, he further said.

India has demonstrated strong growth amid geopolitical headwinds, Raghavan pointed out. Under the leadership of Prime Minister Narendra Modi, the trajectory of India's growth has been "remarkable.". The growth is not restricted to only software and outsourcing but has started "pivoting towards manufacturing" as well.

Although US President Donald Trump's tariff plans are expected to adversely hit China, Raghavan is of the view that the Asian manufacturing powerhouse should not be underestimated.

Currently, it remains to be seen how the tariffs play out and what their impact will be on China's economic health. The country has to navigate through the domestic slowdown while taking measures to address macro-level challenges arising out of measures like tariffs, he said.

"I wouldn't underestimate China. It's the juggernaut of the world economy and has made tremendous progress. The country is far more embedded in the global supply chain than imaginable... The efficiencies of its supply chain over the last two decades have been tested. It is highly efficient from an actual cost point of view," Raghavan pointed out.

Notably, Trump had promised ahead of the US presidential elections to slap tariffs as high as 60% on Chinese imports. This, say analysts, provides opportunity for countries like India, who can benefit from the China plus one strategy.