Farmers have been protesting at the Delhi-Haryana border over the three farm laws (Reuters)
India's new farm laws have "potential to represent a significant step forward" for reforms in the agriculture sector, the International Monetary Fund has said. The international body, however, said people who could be affected the most due to the transition to the new system should be adequately protected.
The IMF weighing in on the three new farm laws comes on a day when Union Ministers and farmers are set to meet for a ninth time to find a solution to the demands of farmers, who among other conditions want the laws withdrawn entirely.
"We believe the farm bills do have the potential to represent a significant step forward for agricultural reforms in India," IMF communications director Gerry Rice told reporters in Washington on Thursday, news agency PTI reported.
"The measures will enable farmers to directly contract with sellers, allow farmers to retain a greater share of the surplus by reducing the role of middlemen, enhance efficiency and support rural growth," Mr Rice said.
"However, it is crucial that the social safety net adequately protects those who might be adversely impacted during the transition to this new system," the IMF spokesperson said, adding this can be done by ensuring that the job market accommodates those that are impacted by the reforms.
Thousands of farmers, mostly from Punjab and Haryana, have been camping at state border points near Delhi, demanding a complete repeal of the three farm laws and legal guarantee of minimum support price for their crops.
The government has said it was ready to discuss the laws clause by clause, but the farmers have stuck to their demand of complete repeal of the laws. They have planned a tractor rally on January 26, Republic Day, though the centre has asked the Supreme Court to make the farmers stop that rally as it could tarnish the country's image on an important day.
The centre has said the laws - passed in September last year - will boost farmers' incomes by letting them deal directly with big companies and bypass government-regulated wholesale markets. But many of the unions disagree, saying they risk losing their bargaining power and becoming vulnerable to potential bulk buyers. They fear the eventual disappearance of MSP - the guaranteed prices the government pays for their grain.
With inputs from PTI