India will increase spending on a populist debt relief plan for farmers by nearly 20 per cent, adding to growing fiscal pressure as global prices of oil and commodities soar.

Palaniappan Chidam­baram, India’s finance minister, on Friday said the government would spend nearly $18bn (€11.4bn, £9,1bn) to write off bad loans by farmers, in a significant rise from the original $15bn package unveiled in February.