Maharashtra has a GDP of ₹51 lakh crore which is the largest among all the states in the country. Like the stark contrast between India and Bharat, Maharashtra too has two disparate geographies. One is the shehri (urban) Maharashtra that has prosperity and affluence while the gramin (rural) Maharashtra is marked by poverty and deprivation. The fact that just Mumbai and Pune have a third of Maharashtra’s GDP shows the huge income inequality and concentration of wealth in the state.
Maharashtra’s agrarian crisis is not new. The state has always had the highest number of farmers suicides in the country. Many describe Maharashtra’s agrarian crisis as a drought problem. Yes, drought is the trigger but it is not the whole story. The core issue is that cultivation almost completely depends on seasonal rain and the farmer is left alone to brave uncertain prices and rising input costs. The role of the government in this agrarian crisis is pivotal and despite having all the required data and know-how, successive governments have singularly failed in tackling the growing agrarian crisis in the state.
A Drought Exposing Structural Weaknesses
Let us start with the monsoon. The southwest monsoon, responsible for about 85% of Maharashtra’s annual precipitation, withdrew on October 8, 2026. The state received 804.4 mm of rainfall against a long-period average of about 994 mm (a deficit of roughly 19%). Drought was declared in 305 of the state’s 358 tehsils. The Marathwada region faced a 39% rainfall deficit, Vidarbha 27%, and northern Maharashtra 34%. Amravati district received 495.6 mm against an average of 822.9 mm, a shortfall of 40%. 82% of agriculture in Maharashtra is rain-fed, with only 18% irrigated. In Marathwada, water storage was reported at about 44%, 37% below the previous year. In some districts of Vidarbha, it is down to 15%. By the end of September, 2,000 villages were receiving water through tankers.
These figures demonstrate the absence of drought preparedness and show the government in poor light. The Water Resources Department and Irrigation & Flood Control Department have a combined budget of ₹36,000/- crore. That is nearly 4.68% of the state’s total budget. Obviously, the funds are either inadequate or have been siphoned by corrupt officials of the department.
Relief cannot Substitute for Security
After its October 14 Cabinet meeting, the state government announced an initial payment of ₹5,000 for around 1.25 crore farmers in drought-affected tehsils. It is estimated that this could cost the exchequer ₹6,000–7,000 crore. The final number of beneficiaries and expenditure, however, remains uncertain. According to experts, cotton cultivation costs at least ₹30,000 per acre, while soybean costs ₹20,000-23,000. Farmers’ organisations have demanded compensation of ₹1 lakh per hectare. What is required are timely crop-loss assessments and compensation linked to real losses.
Since our policies revolve around land ownership, the real and deserving beneficiaries get a raw deal. For example (as reported by Frontline Magazine), Qayyum Shah – a tenant cultivator who rented 10 acres at ₹12,000 per acre, still owed ₹1.2 lakh in rent after losing his cotton crop and spending ₹3 lakhs on various inputs required for cultivation. Because the land did not belong to him, he was reportedly ineligible for compensation. The person who actually cultivates the land must be recognised in relief and credit policy. Otherwise, tenant farmers and sharecroppers will discard agriculture for the gig economy by becoming migrant labour or Uber/Ola drivers in big cities.
Debt When Income Disappears
Interest-based debt for farmers is highly risky. Farm income is uncertain but repayment obligations (interest-based monthly instalments) are fixed and then keep increasing in case of default. Among the input costs of farmers are seeds, fertiliser, pesticides, labour, fuel and sometimes even rent well before harvest. Unfortunately, paying the loan has to be done even if crops are destroyed and there is no source of revenue.
One failed season and the loss of produce is sufficient to wreck the life of a farmer. The account of farmer (as reported by Frontline Magazine) Ganesh Joshi illustrates this financial injustice. On his 3.5-acre farm in Marathwada, only a quarter of his vegetable crop had survived by early October, and his well had dried up. He estimated that he had already lost ₹50,000 and needed another ₹20,000 to prepare for the next season. If he does not get that money, his future is bleak and will be pushed to take extreme decisions.
Consequently, 2,851 farmer suicides were reported in Maharashtra in 2023 and 2,635 in 2024. There were 781 deaths in the first nine months of 2025, despite rainfall close to 120% of normal.
From Subsidised Loans to Interest-Free Finance
Maharashtra already has different loan schemes for farmers. However, their success depends on the farmer paying the instalment on time. Under the state’s Dr Panjabrao Deshmukh interest rebate scheme, eligible farmers who repay short-term crop loans by the prescribed deadline can receive a 3% subsidy on loans up to ₹3 lakhs.
The Maharashtra Cooperation Department says that, combined with the central prompt-repayment incentive, eligible loans can effectively become interest-free. In 2024-25, ₹300 crores were distributed to 9.38 lakh farmers under the state scheme. The central Kisan Credit Card framework also offers eligible short-term loans at subsidised rates, potentially falling to 4% for prompt repayment. These schemes are beneficial but a farmer whose crop fails is unable to meet the loan deadline. Rather than making timely repayment as the condition to credit-relief, policy should protect those cannot pay because of the vagaries of nature.
Maharashtra should pilot a broader interest-free agricultural finance option through public, cooperative and rural banking institutions. A revolving public fund could provide eligible cultivators with interest-free seasonal finance, backed by transparent rules, independent audits and government support for administration and verified disaster losses. Repayments would replenish the fund for the next season. Tenant farmers and sharecroppers must also be eligible and not just landowners. In drought-affected areas, the scheme should offer repayment extensions against verified crop loss. Interest-free finance requires legal and financial approval.
The government must immediately switch to this interest-free mode of offering credit for agriculture-based requirements. This would mark the first step towards reducing farmers’ dependence on the cancer of interest-based debt that grows regardless of harvest outcomes. “Interest is the silent thief that steals the fruits of your labour while you sleep,” said Robert Kiyosaki. It is time Maharashtra incarcerates this thief to come out of its depilating agrarian crisis.