New farm laws have potential to raise income: IMF chief

IMF Chief Economist Gita Gopinath. File   | Photo Credit: REUTERS

India’s new farm laws have the potential to increase farmers’ income, but there is a need to provide a social safety net for vulnerable cultivators, the International Monetary Fund’s (IMF) Chief Economist Gita Gopinath said on Tuesday.

Indian agriculture is in need of reforms, she said.

There are multiple areas where reforms are needed, including infrastructure, the Chief Economist of the Washington-based global financial institution added.

The three farm laws, enacted in September last year, have been projected by the Indian government as major reforms in the agriculture sector, which will remove middlemen and allow farmers to sell their produce anywhere in the country.

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“These particular farm laws were in the area of marketing. It was widening the market for farmers as they will be able to sell to multiple outlets besides the mandis, without having to pay tax. This has the potential to raise, in our view, farmers’ incomes,” Ms. Gopinath, in response to a question on the new farm laws, said.

“That said, every time a reform is put in place, there are transition costs. One has to make sure and pay close attention that it does not harm vulnerable farmers, and make sure that a social safety net is provided. Clearly, there is a discussion right now and we’ll see what comes out if it,” she added.

Thousands of farmers in India, mostly from Punjab, Haryana and western Uttar Pradesh, have been camping at several Delhi border points since November 28 last year, demanding a repeal of the farm laws and a legal guarantee on the Minimum Support Price (MSP) for their crops.

So far, 11 rounds of talks have taken place between the government and farmer leaders, with both sides hardening their positions.

In the last round of talks, the government offered to suspend the laws for one-and-a-half years and form a joint committee to find solutions, in return for the protesting farmers to go back to their respective homes from the Delhi borders.

Farmer leaders, however, said they would settle for nothing less than a complete repeal of the laws, which they find pro-corporate, and a legal guarantee for the procurement of crops at government-fixed MSP.

The Samyukt Kisan Morcha (SKM), an umbrella body of 41 farmer unions, is leading the protest against the three Central farm laws at several border points of Delhi.

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Printable version | Mar 2, 2021 11:57:43 PM |

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