How is indebtedness both the cause and effect of poverty? Explain.

The high level of indebtedness is both the cause and effect of poverty because the
people in India, including the poor’, spend a lot of money to fulfill social obligations. They borrow money from the moneylenders at high rate” However later on they are unable to repay in time. Similarly small farmers need money to buy agricultural inputs like seeds, fertilizer, pesticides. They do not have savings. So they too borrow. Unable to repay. because of poverty they too become victim of indebtedness” Thus, high level of indebtedness is both cause and effect of poverty.