The UP model: Farm loan write-offs win votes in India, but may hurt economy

India risks straining public finances and undermining already ailing state banks, economists said, after a $5.6 billion loan write-off for farmers in Uttar Pradesh and moves to do something similar in at least four other states.

One of the first acts of the new government in India's most populous state following last month's election triumph of Prime Minister Narendra Modi's Bharatiya Janata Party (BJP) was to keep a promise to provide debt relief to 21.5 million farmers.

Taking their cue from Uttar Pradesh, more state governments could waive loans to farmers, senior officials there said, to fulfil election pledges or woo rural