Farmers Indebtedness in India An Economic Analysis

India is an agrarian economy with around 60 per cent of its population directly or indirectly depend upon agriculture and allied activities. But, this sector is often attributed as gambling and natural calamities as monsoon. The failure of these monsoons leading to a series of droughts, lack of better prices, exploitation by middlemen, all of which have led to
severe indebtedness of the farming community. In the recent era, the increase in cost of production outweighed the output prices and this led the farmers to enter into debt trap. To overcome this phenomenon, the Government of India announced a relief package for farmers, called the
Agricultural Debt Waiver and Debt Relief Scheme, which included the complete waiver of loans given to small and marginal farmers. This package served nearly 30 million small and marginal farmers and the burden amount of nearly 500 billion rupees was waived. However, the implementation of this Scheme showed adverse influence on the repayment pattern of even genuine farmers after 2008. With this
background, this study was attempted to analyze the causal factors for farmers’ indebtedness, implications of the Agricultural Debt Waiver and Debt Relief Scheme and rendered useful suggestion to overcome farmers’
indebtedness. This book is a useful information tool to the policy makers working for the betterment of our farmers.