An Indian labour rights activist whose arrest sparked global outrage was granted bail on Friday, days after her family and supporters alleged she was tortured in custody.

Nodeep Kaur, 25, was arrested last month during a protest by workers outside a factory on the outskirts of the Indian capital New Delhi.

Her arrest triggered a storm of criticism with supporters alleging she was sexually assaulted and tortured in custody.

Police have strongly denied the allegations and say Kaur attacked policemen with sticks.

Meena Harris, niece of US Vice President Kamala Harris, called for Kaur's release earlier this month, tweeting that she was "tortured & sexually assaulted in police custody".

Labour MP Tanmanjeet Singh Dhesi brought up Kaur's arrest in the British parliament, saying he was alarmed by the torture allegations.

Nodeep Kaur had been participating in the farmers' protest against the Indian government's new free market farm laws
Nodeep Kaur had been participating in the farmers' protest against the Indian government's new free market farm laws AFP / NARINDER NANU

Police have accused Kaur, who belongs to India's low-caste Dalit community, of unlawful assembly, attempted murder and extortion, according to reports in the Indian media.

Her sister Rajvir Kaur confirmed to AFP on Friday that she had won bail from the Punjab and Haryana High Court.

"We also have to get her medically examined," she said.

Kaur had also been participating in an ongoing months-long farmers' protest against the Indian government's new free market farm laws, in what has emerged as a major challenge to Prime Minister Narendra Modi.

The government has offered to suspend the laws for 18 months but farmers say they must be repealed.

The protests have invited international attention, with pop star Rihanna and Swedish climate activist Greta Thunberg tweeting their support for the farmers, drawing the ire of the government.