New Delhi: The Indian art market’s recovery could take place earlier than expected, according to a just-out report by London-based art market research firm ArtTactic Ltd. The report says that there is renewed confidence in the market, which had dipped to an all-time low six months ago.
Its current confidence indicator for the Indian art market is pegged at 49, just under the 50 mark. The 50 mark indicates that there are an equal number of positive and negative responses on the outlook for the art market in the short term. In May, the same indicator was in the negative territory, pegged at 20.
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The ArtTactic Indian art market confidence indicator for modern and contemporary art is based on interviews with 89 players in the Indian art market. While only 19% of the respondents in May believed the Indian contemporary art market would recover within two years, this has gone up to 33% in October.
Signs of a thawing market have been visible over the last few months. Neha Kirpal, associate director of the India Art Summit that held its second edition in August in New Delhi this year, says that sales at art fairs and auctions are rising. Sree Goswami, director of Project 88, the only Indian gallery to participate in the prestigious Frieze Art Fair in London, was there last month and found the mood at the fair surprisingly upbeat: she sold seven of the 12 works on offer to international buyers with a specific interest in Indian contemporary art.
Sales figures released by art auction houses corroborate these sentiments: In its March auction, Sotheby’s sold 76 of the 139 lots on offer (54.7%) while its September auction sold 63 out of the 89 lots on offer (70.8%). More dramatic are the Indian auction house SaffronArt’s comparative results: Its March auction realized Rs7.8 crore against an estimate of Rs13.2 crore, while its September auction realized Rs17.5 crore, exceeding its Rs16.4 crore estimate.
“It was a state of not knowing that prompted market experts to estimate a recovery in two or more years. Things look far better now—success at art fairs such as Frieze and Basel, and recent auction results have put everyone at ease,” says Kirpal. She adds that the number of galleries signing up for the next edition of the India Art Summit has also gone up compared to this year. Summit organizers have booked 8,000 sq. m of space (up from 4,500 sq. m this year) and expect to accommodate 20 more galleries. Kirpal refutes the negative impact on the market by investors whose money is locked in underperforming art funds.
Interest revival: A 19 August photo of the Indian Art Summit held at Pragati Maidan in New Delhi. Rajkumar / Mint
Dinesh Vazirani, CEO of SaffronArt, corroborates this by saying that the market has shifted from being an investors’ market to a collectors’ market. “The speculative investors are not part of this current growth spurt yet. We now have established collectors and new collectors coming into the fray.”
Besides keeping tabs on the overall market sentiment, the ArtTactic report also tracks confidence levels in individual artists and “survival ratings” for 15 modern and 16 contemporary artists. Among the modern masters, artists such as F.N. Souza, Zarina Hashmi and Jagdish Swaminathan whose indices had remained in the positive territory even in May, show a greater upswing. Amongst the contemporary artists, most striking are the indices for Thukral and Tagra, Subodh Gupta, Bharti Kher, N.S. Harsha and Jitish Kallat whose indices come back to positive territory after hitting negative lows in the May 2009 report.
Sceptics are wary of putting too much store by the ArtTactic report as they feel that the respondents surveyed stand to benefit by projecting a positive market sentiment. Anders Petterson, managing director of ArtTactic, says that this bias is dealt with by making sure the survey sample is a balanced mix between the trade such as galleries, auction houses (domestic and international), domestic and international collectors, investors, curators, historians, critics and writers. “It’s a cross-section of the most important players in the Indian art market. Many of them have a long-term interest in the market, and hence their answers will not be driven by short-term decisions,” he says.
Petterson mentions a significant increase in both subscriptions and enquires for bespoke research from the Indian art market client base since the beginning of 2009.
Maithili Parekh, deputy director of Sotheby’s, feels that the ArtTactic report is of value as it is the only available quantifiable report of the Indian art market. “But I would caution against a sole reliance on quantified surveys such as this,” she adds.
Art market quick facts
Top end of the market regains confidence
In May 2009, the ArtTactic confidence survey showed that there was zero confidence in the higher-end of the modern Indian art market. In the last reading in October 2009, 16% of the respondents were positive to the top end of the Indian art market (works valued at $1 million and above), and 25% of the respondents were positive to the $500,000 to $1million price bracket
Prices go down; speculation
The liquidity in the Indian art auction market is down 54% since September 2008, when Christie’s, Sotheby’s and Saffronart raised $23.9 million.
The recent sales in September 2009, raised a total of $11 million. 61% of the respondents believe the modern Indian market could face more downward pressure on prices.
In the contemporary Indian market, 75% of the respondents believe that prices will continue to decrease. However with an expected downward pressure on prices, the risk of speculation has re-entered the market, after a significant drop in May 2009.
The ArtTactic Speculation Barometer shows a 21% increase in the contemporary Indian market. Respondents surveyed expressed concern that significantly lower prices are providing an opportunity for speculators to re-enter the market.