For preparing Bengali fish curry with yogurt, mix together 1/2 tsp of red chilly powder, pepper powder, turmeric powder and salt. Marinate the fish in this marinade and keep aside for 10 minutes.
Heat 1 tsp of oil in a non stick pan and fry the fish pieces for 2 minutes and keep aside.
Saute onion, ginger and garlic in the same pan till golden brown. Add remaining chilly powder. Fry well.
Allow the onion mixture to cool and grind in a food processor adding mustard seeds.
Heat remaining oil in a pan and add the ground paste, green chillies and yogurt. Cook for few minutes.
Add water and fried fish pieces. Cook in low flame till the gravy thickens.