Shahpur police station in-charge Jitendra Bhaskar said that the farmer, identified as Gokul Singh Chouhan, committed suicide by consuming poison at his farmland in Chondi village, about 30 kilometres from the district headquarters.
"The exact reason for his step would be known after investigations," Bhaskar said.
Danlu Chouhan, the farmer's elder brother, said the deceased was unable to repay an old loan and was distressed as his land was falling in the submergence area of a project.
Devendra Singh, manager of Sewa Sahkari Samiti, a credit society at Mohad, said that the farmer's mother had taken a loan of Rs 53,000 in 1999 from the credit society but the amount had spiralled to Rs 2.10 lakh due to non-payment.
District Collector Deepak Singh, however, said it had to be investigated as to how this old loan was still pending.
Singh also said that no process of land acquisition was in progress for any project in the district.