As school-kids, an annual visit to the circus was par for the course for many of us.  Now, being older and greyer, but not necessarily wiser, we market-participants still seek the thrill of the circuses of yore.

An avenue to fulfil this aspiration comes along once a year in the form of the Union Budget. It is a literal media circus with the electronic and print media rounding up the ‘usual suspects’ from India Inc., the Stock-markets, Opposition parties and for good measure, even the hoi polloi and seeking out their words of wisdom and hold your breath, even advise for the Finance Minister.

The invariable title under which the (more often than not self-centred) views of these esteemed women and men are sought is ‘Budget-Wishlist’. That no Finance Ministry official has the time or inclination to pay any attention to these wish-lists has been more than apparent over the years.

This year, India Inc. is literally out on a limb begging for an extension of the ‘economic stimulus’. Well, the same set of chaps are dead averse to a ‘populist budget’. If one reads between the lines, it means – as long as the dole-out benefits me , it is reform, if it is for the masses, damn, it is populist.

To buttress this point, try and make sense of the demand of IT company honchos to further extend the STPI tax exemption.

As for market-participants, additional outlays for NREGA or a mid-day meal for poor school-children that positively impacts millions is thumbed down with a Sensex slam dunk, but the withdrawal of STT or dividend tax which positively impacts a few hundreds and thousands is met with a 100 point Sensex salute.  Amen !   

The Opposition in India is more often than not the primary reason why the ruling party of a given time, ends up as the ruling party. And so, you have ex-Finance Ministers talking of the need for further ‘reforms’. That they did nothing worthwhile during their tenures is of course, incidental.

One ex-Finance Minister did achieve his Disinvestment target. It is perhaps merely a technical issue that this was done by getting other PSUs to invest in the stake they divested.

That the current Finance Minister is impressed by this method of meeting disinvestment targets is apparent from the quantum of funds that the PSU financial institutions have pumped in to salvage the last two FPOs from the Government’s stable.

Finally, as far as PSU Banks and their financial figures go, I am always reminded of what Lord Krishna tells Arjuna in the Bhagwad Gita about ‘Maya’ ( the illusion ). So, they simply write off accumulated losses against equity and hey, all of a sudden, not only have the losses vanished, but also a high EPS and low P/E multiple materializes  enhancing valuations of the bank.

Notwithstanding all this, we still have a ‘Growth Story’ to tell………… Will the FIIs listen, please ?