The debt trap is the situation when a person becomes indebted and there is no way in which the debt can be repaid. It mainly occurs in the agricultural sector in rural areas. The farmers require cheap credit for the purchase of pesticides, fertilisers, seeds and other farming equipment. But adverse situations like crop failure will make the farmers incapable of repayment. This debt increases with every fresh instalment of loans taken and finally results in a debt trap from which the farmers are not able to recover.