Budget 2012-13: Opening of ECB to power sector meaningless: Dalton Capital

In an interview to CNBC-TV18 UR Bhat tells that there is a huge reform in subsidiary regime that is outside the Budget. He also says, the money market today signaled that under provision for subsidies are bothering the Reserve Bank.

Below is the edited version of the transcription. Also watch the accompanying video. Q: Will the RBI be convinced with all this or will excise duty hikes be passed on, crude remaining at a USD 125 and therefore it's inability to lower rates. What is the other trigger for the market. Does it just languish here or will it live on the hope of a rate cut?
A: As far as the RBI is concerned, the under provision for subsidies, especially fuel subsidies and the provisions is nearly Rs 1,00,000 crore because whatever has been provided, Rs 43000 is enough for the backlog.
For this year, either they are going to deregulate completely and there is not going to be any subsidiary requirement or it is going to be another of these 4.6-5.9 jump. That is something that certainly would be bothering the RBI which is clearly reflected in the money markets today. There is a huge reform in subsidiary regime that is outside the Budget.
Q: How would the bank index move?
A: If you see the CDR score, it looks like every other company is going for CDR.
The RBI probably next year will have to do something about repeated restructuring.
So that are not recognized as an NPA.
Otherwise, NPAs will be probably very high. But one good thing out of the Budget is, that even though there is under provisioning for subsidiary, capitalization but it could have been much more populist.
The fact that in the penultimate Budget they are not very populist, taking it double negative that they are hoping that they will present another Budget before the election. That