Economic Hardship and Agrarian Pain: The Debt Crisis of Farmers in West Bengal

Debts can be both exploitative and emancipatory at the same time. Debts have the potential to trap rural households in new forms of exploitation. The agrarian crisis poses a significant challenge to the agricultural economy. Productive utilization of agricultural credit is very limited in West Bengal, as the farmers are experiencing financial distress. Debt distress is one of the main reasons for farmers’ discomfort. The growing debt burden diminishes creditworthiness, trapping farmers in a cycle of debt accumulation. Defaulting credit increases the pressure on financial institutions’ non-performing assets, leading to serious credit allocation problems. The present research aims to identify the influencing factors that are solely responsible for farmers’ discomfort in West Bengal by using binary logistic regression analysis involving 280 borrower farmers. The study finds that larger family sizes, higher education levels, and greater farm experience significantly reduce farmer distress. On the other side, low credibility, consumption credit, and unproductive borrowing increase the financial vulnerability of the farmers. These results highlight the importance of socioeconomic stability and productive credit use in mitigating agricultural distress.