Rahul Gandhi ratchets up pressure on PM Modi to waive farm loans

NEW DELHI (Reuters) - Opposition leader Rahul Gandhi pressed Prime Minister Narendra Modi on Tuesday to write off farm loans to help growers reeling from lower food prices, ratcheting up demands for debt write-offs ahead of a general election that must be held by May.

Gandhi's Congress party, which last week beat Modi's Hindu nationalist Bharatiya Janata Party (BJP) in three key state elections, on Monday waived farm loans, a poll promise, in Madhya Pradesh and Chhattisgarh states.

Congress is also likely to write off farmers' loans in Rajasthan, the third of those states.

"My message to farmers is that this country belongs to you and the Congress and other opposition parties will work together to ask Prime Minister Modi to write off your loans," Gandhi told reporters in parliament. "We'll not let him sleep until he waives your loans."

The prime minister's office did not respond to a Reuters request for comment.

India's 263 million farmers and their many millions of dependants form an influential voting bloc, with agriculture employing nearly half the 1.3 billion people and contributing about 15 percent to the $2.6 trillion economy, Asia's third largest.

In 2008, the Congress party-led coalition government announced farm loan waivers worth nearly 720 billions rupees, helping it return to power with a bigger mandate in 2009.

With the national election imminent, both Congress and the BJP are courting farmers who have staged protests in the capital New Delhi and the financial hub Mumbai to complain about rising farm operating costs and falling prices for their produce.

Reuters last week reported that Modi's government is likely to announce loan waivers worth billions of dollars to claw back support among farmers after losing the three state elections.

The plan could see as much as 4 trillion rupees ($56.5 billion) in loans written off, risking straining public finances and undermining already ailing state banks.

($1 = 70.52 rupees)

(Reporting by Mayank Bhardwaj; Editing by Nick Macfie)