Price rise paints a pretty picture
11 Feb, 2008, 0011 hrs IST,Ashoke Nag, TNN
KOLKATA: While the phenomenal rise in Indian art prices may have slowed down the market to an extent, it is also true that price growth has fuelled demand levels in the past three years or so. When art prices were low some years back, buyers in India and especially those based abroad did not seem to notice Indian art much. Marketing of Indian artworks, especially paintings to begin with, by galleries and auctioneers also began with increasing art prices.
"The price rise has probably been the key to the spurt in demand for Indian art at all levels. That encompasses gallery owners, auction houses, individual collectors and private dealers. Earlier, most dealers and galleries considered dabbling in Indian art an unremunerative preoccupation. Only the die-hard and seasoned collectors were acquiring art notwithstanding the extremely modest prices of art pieces. With the burgeoning prices, the scenario has witnessed a sea change. Art functionaries across the board have got involved in this sphere," an art market source told ET.
The magnetism of art as an investment instrument grew as art circles were taken aback by the pace at which Indian artists achieved success and fantastic price tags. The boom in price levels began with the modernist group of artists who, led by the high-end brands, have achieved phenomenal price points over a five-year time frame. This huge market movement in the modernist's fuelled collectors and investors to go for the contemporary artists whose prices also started to trace the northward graph.
"There is a clear indication that the contemporary bunch of artists, like the mid-caps in the stock market, are the large caps of tomorrow. In fact, a select group among them are hovering between the Rs 1 crore and Rs 2 crore band. Here again, the price perception about the contemporary category of artists is driving demand," the source said.
One of the developments at the collector level is that higher returns from art has found them going for churning their artworks.
Thus, they may have offloaded a part of their collection to book profits and deployed the funds into pieces which are projected to add more meat in value terms. Price growth has attracted new art buyers who are looking for wealth appreciation.
"It is true that Indian art, from its creative and aesthetic standpoint, is being discovered by world. However, a fact which can't be denied is that global market watchers are looking at the qualitative aspects of Indian art more closely once its prices started reaching international levels," the source said.
Interestingly, there are also clear signs that art by the old masters, which was languishing price-wise for long, is perking up now and this development may trigger further buying in this genre of paintings. From the overall standpoint, market makers must be careful in not pushing up prices to artificial levels which invariably ends up in stagnation and a demand drop.