Tribune News Service
New Delhi, January 27
The International Monetary Fund (IMF) says India will be the only major economy of the world to register a double-digit growth in 2021 even as it asked the government for a social security net to give a humane face to the farm laws.
The IMF’s projection of 11.5 per cent growth rate in 2021 in its latest World Economic Outlook Update showed a strong rebound in the economy, which may have contracted by eight per cent in 2020.
China is next with 8.1 per cent growth in 2021, followed by Spain (5.9 per cent) and France (5.5 per cent).
The IMF gave conditional backing to the farm laws saying they have the potential to represent a significant step forward for agricultural reforms in India. But the government must properly protect those who could be impacted during the transition to this new system as well as strengthen the social safety net, said IMF Chief Economist Gita Gopinath. She was basically reiterating the observations by IMF spokesperson Gerry Rice on January 15.
“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 middle men, enhance efficiency and support rural growth,” she said.
The net may require further strengthening so as to ensure that the job market can accommodate those that may be impacted by the reforms.
“And of course, the growth benefits of these reforms will depend, critically, on the effectiveness and the timing of their implementation, so need to pay attention to those issues as well with the reform,” her colleague Rice had observed.
IMF Managing Director Kristalina Georgieva has also commended India for decisive action to deal with the pandemic and its economic consequences. She felt India had scored higher than the average for emerging markets on both monetary policy and fiscal policy side.
Revising its figures, the IMF said in 2020 the Indian economy is estimated to have contracted by 8 per cent. China is the only major country which registered a positive growth rate of 2.3 per cent in 2020.