Do states have fiscal space for farm loan waivers?

From a fiscal viewpoint, Maharashtra is better-placed than most states

After the announcement of a farm loan waiver by the Uttar Pradesh government, farmer protests have intensified in Maharashtra and Madhya Pradesh, with calls for similar loan waivers gaining traction. Do these states have the fiscal space to provide such waivers? If so, is a loan waiver a prudent way of utilising funds?

Take the case of Maharashtra. 

From a fiscal viewpoint, the state is better-placed than most. Its fiscal deficit as a percentage of gross state domestic product (GSDP) has been budgeted to decline from 2.2 per cent in 2016-17 (Revised Estimate or RE) to 1.53 per cent in