KOLKATA: There’s little doubt that the global financial meltdown has dented the art market to a degree. Historical data suggest that art markets d
ecline 6-12 months after a financial crash. However, in the present debacle, the reaction seems to have been quicker.

The downswing in the art scene, however, has also extended opportunities to the avid collector to lap up quality works of modernist masters and heritage artists from, for instance, the Bengal School of Art at prices lower than the highs achieved during the boom time.

Mr Nirmalya Kumar, a top UK-based art collector and professor of marketing at the London Business School, told ET: “The September 2008 auctions by Sotheby’s and Christie’s in New York did not fare too badly. But, the recent auction of Indian and Islamic art in London clearly indicates that the crisis is taking its toll. Not only were a number of lots left unsold, many of them either fell short of the minimum estimate or just touched the minimum level. I managed to pick up a beautiful Francis Newton Souza for just £5,000. From an investment angle, one should definitely avoid acquiring contemporary artists, who have ascended dramatically over the past 24 months. There’s every possibility that their prices could fall in the next six months.”

The positive side of all this, Mr Kumar said, is that the top-quality works of modern masters, such as Souza, Husain and Raza, will retain their value. At the same time, heritage artists, including those from the Bengal School like Rabindranath Tagore, Jamini Roy and Nandalal Bose, should maintain their value because they have risen steadily and their supply is limited.

“The second quality works of the modernists, however, have seen a decline.” “You can cherry pick, but one shouldn’t buy with the thought that prices will rise significantly in the short run. One should buy what is likable and look at a longer holding period. It’s difficult to predict the direction that the March 2009 auctions of Sotheby’s and Christie’s will take. They are six months away. I’ll be surprised if there is sizable price rise,” Mr Kumar added.

“The NRI fraternity abroad was largely buying Indian art for investment. Only a few, probably, harbour the collector’s psyche. These collectors may take the opportunity to buy works at these depressed prices,” Mr Prakash Kejariwal, collector, art specialist and director of Chitrakoot, Kolkata’s oldest art gallery, said.

“Back in India, those who were investing their surplus share market funds in art will discontinue this pursuit for the time being. There are only a few collectors who don’t depend on the stock market to buy art. But this community is limited. So, the market is bound to shrink and prices could plateau.”

Mr Kejariwal also underscored that quality works of progressives and modernists like Ganesh Pyne, Bikash Bhattacharjee, Somnath Hore, Jogen Chowdhury and Rameshwar Broota are definite buys. In tandem are the old masters like Raja Ravi Verma. Buyers could also go for sculptures, which still enjoy price elasticity. “We must understand that art prices don’t collapse like share tags do. Art is not quoted in the markets as shares are,” Mr Kejariwal said.

Vikram Bachhawat, a well-known gallerist who heads Aakriti Art Gallery and is also the director of Emami Chisel Art, said he has been interacting with people in Mumbai and Delhi and most collectors have shown an interest in sourcing art.

“But, investors want to wait and watch. Some new investors are viewing art as an alternate avenue. At the moment, investors are focusing on auction-listed artists, who number around 300. At the same time, average artists will be glossed over in this market. If fund houses start ploughing money into art, the market, pegged at Rs 1,500-2,000 crore now, will expand at least three-fold.”

“The art market has been under pressure for the past eight to nine months, even before the stock markets crashed. Art works, both high and medium value, have slipped by 25-30%. Someone with liquidity can easily go for high quality modernist works with a long-term perspective. These pieces are available now at 35-40% below the market price a year ago. It’s the right time to buy if one chances upon a good piece. One should look at a timeframe of three to five years while making such an acquisition, though,” Abhijit Lath, collector and director at Akar Prakar Gallery, said.

Herve Perdriolle, Indian art consultant at leading French auction house Artcurial, hinted at some optimism: “Many factors should make the Indian market, particularly in these depressed stock market times, a favourite destination for investors and collectors. The Indian market is only about 0.1% of the international market. Compared with 45% of the market share held by the Americans, we can easily imagine a high-growth margin for the Indian art market.”