PICTURE SPEAK

WATCHING VALUE: Art historian Jyotindra Jain (centre) and artist Subrata Kundu at an auction preview

Take the signifiers: till just five or six years ago, virtually all international auction houses would deal mainly in Indian antiquities (mostly of doubtful provenance) and the decorative arts with the odd Ravi Varma, Jamini Roy or A.R. Chughtai thrown in towards the end of the sale. Today, the order has been reversed. It is names like Tyeb Mehta, M.F. Husain, S.H. Raza and Francis Newton Souza that lead the list now. Last week saw New York hosting yet another round of Indian contemporary art auctions. Over March 29 and 30, Sotheby's and Christie's, in the course of two hectic sessions of global bidding (including incessant phone bids from India), sold off 368 art works for a whopping collective price of Rs 130 crore. In the last few years, not only have these houses increased their auctions of Indian art from one each to four a year, they have also been joined by others like Bonhams, Bowrings, Neville Tuli's OSIAN's and Dinesh Vazirani's Saffronart, the last two being fully swadeshi enterprises.

The blue chips    Although their individual styles may    differ widely, you can't go wrong    with    these perennial favourites

GRAND MASTER: M.F. Husain's is easily the most well-known signature in the country. Flamboyant and controversial, this ever- green genius has been singularly responsible for creating a wider market for Indian art. THE ASCETIC: Tyeb Mehta is the reclusive face of the artistic fraternity. A rather cerebral painter, he does very few canvases in a year. His images dwell on the dynamics of contrast: between man and woman or love and hate. THE LONER: V.S. Gaitonde is the most celebrated abstract painter of the post-Independence era. With no media hype and few known patrons, this painter is famous for the zen-like aesthetics of his monochromatic works. THE COLOURIST: S.H. Raza, the master of the calibrated pallette, divides his time between Paris and Delhi. Deeply influenced by the tantric concept of the bindu, his geometric works in brilliant hues have a global appeal. THE REBEL: J. Swaminathan is best recalled for his lyrical Bird-Mountain series and his tribal abstracts. A poet and writer, he was as articulate with words as he was dextrous with the brush and the paint. He made his own rules, only to break them.

With Lakshmi, the goddess of good fortune, smiling on Indian art, it is not surprising that everyone who's anyone wants a slice of the pie. Or, if that is too dear, to at least catch a whiff of its tantalising aroma. You only have to mention that you possess a few paintings or are "in the know" of matters artistic and you suddenly find yourself very popular. They corner you at parties for tips, they invite you to dinners for deep discussions, they call you up at all hours of the day and the night and now they have even started accosting critics at street corners. And they come in many disguises. As suave NRI patrons setting out on their discovery of India, or as friendly local acquaintances dropping in casually for a drink. One might even come in as a carpenter to frame a painting before showing his greed and offering to buy the painting for "a good price". Till-recently-impoverished artists are now fatigued with running from gallery openings to auctions; they are bleary-eyed and heavy-headed with a combination of jet-lag and champagne overdose. Two Delhi painters even had to be hospitalised due to stress and anxiety. One painter regularly checks under his bed to flush out any lurking agents and dealers. Spurred by a frenzy fed by highly publicised public auctions, the new rich elite's new-found art fad is displaying all the signs of a magnificent obsession which is bound to last for some time.

HOW TO INVEST IN ART WITHOUT BUYING

With returns from investments in art spiralling, art funds have mushroomed to lure the moneyed investor For those who can't tell an oil from a watercolour but want to cash in on the big surge in prices of Indian art, galleries are launching art funds. The first was set up by Sakshi Art Gallery owners Praveen Gandhi and Geeta Mehra, along with Sanjay Kumar of Synergy Art Foundation, in August 2005. Called the Yatra Fund, it invests in the works of artists such as M.F. Husain, F.N. Souza and V.S. Gaitonde. Mehra buys and sells these works for the fund. "Yatra is for those who want to invest in diverse assets but don't understand art," says Nilesh Shah, President (broking) at Edelweiss Securities-the stockbroking firm that raised over Rs 12 crore within a month for the fund. The interest is obvious, given that returns from investments in art have beaten all other assets. Auction house OSIAN's will launch a fund in April for contemporary fine art from India, Bangladesh, Pakistan and Sri Lanka. Unlike the Yatra Fund, which has a predominantly layman investor base, this will be sold mainly to the auction house's clients. OSIAN's founder, Neville Tuli, will be its fund manager. To make them investor friendly, these funds have been structured like equity-based mutual funds (MFs). The cumulative value of an art fund, just like that of the portfolio of an mf, is broken into units of Rs 100, which are sold to investors. Gains to investors from the appreciation in the works held by such funds push up the unit value. The funds do not redeem the units before maturity, though they can be transferred to other investors at the declared values. The portfolio of the Yatra Fund, for instance, will be valued and sold after five years and the proceeds distributed to the unit holders. After September 2005, the fund was closed but roaring investors' demand has forced its managers to consider reopening it to fresh investments or to float a new one. Before you hop on the great Indian art bandwagon, be sure to note that unlike in MFs, there is no regulator to lay down a code of conduct, supervise fund operations or redress investor woes. Don't expect to be told the value of your investment daily, as the net asset values are declared quarterly. There isn't any stock exchange for transparent discovery of prices. To avoid being totally at the mercy of the judgement of fund managers, investors can look up the just launched et OSIAN's Art Index. The fortnightly index represents global trading in the arts-weighed by liquidity and historical significance-of 51 leading contemporary Indian artists. However, there aren't any other benchmarks. The lock-ins make investing in art more illiquid than in case of other assets. With the minimum investments pegged at Rs 10 lakh (10,000 units), art funds are mainly for high networth individuals. Returns from art are taxed like long- and short-term capital gains from real estate. If minimum return-called the hurdle rate-is achieved by a fund, its manager gets a share in profits. Tuli will keep 30 per cent of the gains if OSIAN's fund yields more than 15 per cent. Buying, selling and holding art is expensive and involves substantial insurance and maintenance costs, which eat into returns. Apart from the rising valuations of Indian art, it is the high level of risk associated with it that is pushing up returns -By Puja Mehra

"I know it looks like a mad and crazy market, but it is real," sighs Bangalore-based Abhishek Poddar, an old-time collector who started buying art in the late 1980s when a Manjit Bawa or a Jagdish Swaminathan was available for a few thousand rupees. Poddar says, "While initially a few market-savvy dealers might have jacked up the prices, now combined with the strengthening Indian economy it has gathered the unstoppable momentum of an avalanche."

Like most serious buyers of the pre-market boom, Poddar has almost stopped buying now: "We used to fall in love with the work, get to know the artist and his thought process. One looked for the soul of the artist in a work. Whereas today, anonymous bidders tend to merely see the signature of a brand name." Most old buyers find their powers of patronage suddenly passé, usurped by a new and brash generation that is ready to buy them out. In fact, many sophisticates in Mumbai and Delhi who had bought masters like Husain and Souza after striking bitter bargains with the artists and dealers through the '70s and '80s, are now unloading their tidy hoards on the scalding market, making a neat pile in the process.

So how did this seemingly sudden spurt in the art mart begin and who are the new cash-rich buyers?

Many experts believe that, given the quality of Indian art-which, they say, is comparable to the best in the world-global recognition was only a matter of time. Artists and critics have worked assiduously to get the international art market to acknowledge them. Three Indian painters-Husain, Souza and Swaminathan-have passionately articulated this all through their lives. Husain had even predicted long ago that Indian art would truly prosper only when financial speculators entered the market. Today, there are already a couple of Art Funds-similar to mutual funds-in operation (see box). Swaminathan-to quote New York-based art historian Vidya Dahejia-"talked about going beyond the West by going through the West".

As our economy gains muscle, wealthy Indians have started taking pride in things Indian. "Although he has nothing to do with art, a man like N.R. Narayana Murthy has shown that we can be proud of the made-in-India brand in the global context," says Amit Judge of Bodhi Art. And, Bollywood notwithstanding, Indian art is the best product we have to offer. Says critic Suneet Chopra, "From the very beginning, I told people that Indian art was priced at a sixth of its true value. Even today, it is fetching about half its value. That is why I keep telling the cynics, who think that the bubble is going to burst, that there is another 100 per cent to go."

THE YOUNG TURKS    The GenNext of Indian art is confident and armed with a burgeoning demand and    global appreciation

ANJU AND ATUL DODIYA: The Dodiyas, both J.J. School of Art graduates, are highly rated by the cognoscenti. If one of Anju's works sold for a staggering Rs 90.6 lakh at a recent auction, Atul, who shot into limelight with his Mahatma Gandhi series, has already crossed the Rs 1-crore mark. His work has been displayed at, among other venues, the Tate Gallery, London, in 2000. The couple lives and works in Mumbai. JITISH KALLAT: Winner of the Indo-American Young Achiever Award in 2001, this Mumbai-born painter is known for his post-modernist approach and highly inventive image-making, including use of photography. SUBODH GUPTA: This incredibly creative Bihari babu draws on everyday experiences for inspiration that he infuses with a dry sense of urban humour. He has turned ubiquitous objects into hot-selling art works. RAVINDER REDDY: This much-lionised Baroda-trained sculptor brings an eclectic mix of folk and kitsch into his monumental heads. Collectors from New Delhi to New York just can't get enough of his works.

That potential may be realised when professionally managed programmes of art acquisition and display are launched. This is happening, but is still not professionalised to the extent it is done internationally. "It is still left to the wives or to other relatives," complains an artist, referring to some leading business groups' efforts in this sphere. The first major corporate buyers of Indian art were MNCs like Schlumberger, whose former CEO Jean Riboud and his Indian wife Krishna collected an amazing body of excellent works from the '60s till the '80s. The other major collector was the Swede Holk Larsen of Larsen and Toubro. Later, Texan billionaire Chester Herwitz went about collecting a huge body of Indian art that is now partly housed at the Peabody Essex Museum, Salem, Masachusetts. Then there is the irrepressible Masanori Fukuoka, a Japanese fishing tycoon, who now leads the Indian art lovers' club, buying a large numbers of works every year for his Glenbarra Art Museum at Jihoji Himeji, Japan. Amongst the few Indian corporates seriously interested in art are the ITC and The Times of India Group, who also acquired works in significant quantities. The new Times Internet Building in Gurgaon has, in fact, been designed specially to display their art collection. Both have built up sizeable collections, which are now worth hundreds of crores of rupees-many times the value they were acquired for. The Government of India, too, through Air India, the ITDC and the Ministry of External Affairs, bought good contemporary art, but it has neither taken pride in it nor promoted it in any significant manner. Art works by famous painters are languishing at ITDC hotels, either destroyed or pilfered. However, the arrival of the new breed of art buyers on the scene in the last three or four years has pushed prices well beyond the Government of India's purchase budgets.

It is widely presumed that it is the non-resident Indian (NRI) market that is escalating art prices. While NRI collectors like hedge fund manager Rajiv Choudhury (he bought Tyeb Mehta's Mahishasura last September) and realtor Umesh Garg have definitely upped the ante, India's No.1 gallery man, Arun Vadehra, insists that more than 50 per cent of his buyers are in India. "NRIs, foreign individuals and museums account for less than 25 per cent each," he says. For example, Delhi businessman Nand Khemka was the most prolific bidder at OSIAN's Delhi auction, reportedly picking up both the Amrita Sher-Gil (Rs 6.9 crore) and the Gaitonde (Rs 4.88 crore). Yamini Mehta, senior specialist, Modern and Indian Contemporary Art at Christie's, New York, says, "The new collectors are not only NRIs but also resident Indians. For the March sale, we also got strong bids from some American collectors. At the same time, we notice that buyers are beginning to discern quality and hence not all pieces of art are selling at a crazy price."

ART OF FAKE FORTUNES

The fine print on copyright infringements, issues of antiquities and national treasures. What the lawyers have to say.   PICTURE SPEAK SPEAK OUT: (L-R) Sanjay Bhattacharya, Suneet Chopra and Krishen Khanna at a press conference against art forgery; At the margins of the scalding art marts lurk copycats. It is estimated that globally 15 per cent art sales are of fakes. Among the most frequently counterfeited are Salvador Dali, Pablo Picasso and Marc Chagall. At a recently held art auction by OSIAN's in Delhi, a fake was nearly sold off as Bikas Bhattacharjee's work. It was spotted just in time by his disciple Sanjay Bhattacharya and withdrawn by the auctioneers. Subsequently, at the New York auctions of Sotheby's and Christie's, seven and ten works respectively, were withdrawn just before they went under the hammer. "The legal position on forgery and fraudulent practice is well-defined under Indian law," says leading advocate Pravin Anand. If a victim takes legal recourse, the criminal faces up to three years' imprisonment and a fine ranging between Rs 50,000 and Rs 2,00,000. The Antiquities & Arts Treasures Act of 1972, a legacy of the licence raj, which has curbed the export of national treasures like the works of Rabindranath Tagore and Amrita Sher-Gil from the country, is itself antiquated. Section 3 of the Act states that it is unlawful for any person other than the government or any agency or authority authorised by it to export any Antiquity or Art Treasure. Also, if a person in possession of an Antiquity or Art Treasure wishes to transfer the ownership of the work, he should inform the registering officer. This law has only served to suppress the market value of all artists covered under it. Copyright is another contentious issue. The Berne Convention, which lays down minimum standards for global IPR protection, has been implemented in most parts of Europe. But few know that India was one of the first countries to implement it over 10 years ago. Section 53 A of the Indian Copyright Act, amended in 1994, even takes into account the resale of copyright works. According to the sub-section: In the case of resale for a price exceeding Rs 10,000, the author (read artist) has a share in the resale price not exceeding 10 per cent of the sale value. Any dispute regarding this shall be referred to the Copyright Board, whose decision shall be final. But even a decade after the amendment, no artist or heir has come forward to take any gallery or auctioneer to court. Internationally, the art world is divided on the issue of resale rights, says Rodney D. Ryder, head of Technology Law Practice at the law firm Khaitan & Co. "Surprisingly, there are no resale rights in the United States as yet," he points out.

It is interesting that much like development issues in India, in the art scene, too, infrastructure is the problem area. "We have always had excellent art and now there is a hungry market, but the problem lay in the channel connecting the two," says Judge, easily India's most audacious and soon-to-be-biggest art gallerist (see box). To this end, Arun Vadehra of Vadehra Gallery has been publishing books on the artists he has been representing for many years now. Similarly, Neville Tuli of OSIAN's has been passionately absorbed with building a documentation and archiving centre for Indian art for over a decade now. In fact this is the area that the government should be attending to instead of taking on promotional and curatorial roles. The other thing the state could do is rationalise the inexplicably high import duty of 17.5 per cent on bringing back Indian art from abroad. Some gallerists even go to the extent of asking for the removal of sales tax on art purchase. At the same time, the government should also enforce the Intellectual Property Right Law forcefully, including the artist's share on resale of his work.

AUCTION IMPACT | THE DEAL MAKERS

The role and style of art promoters and gallerists are changing fast to keep pace with rising demand   PICTURE SPEAK THE PROMOTERS: Neville Tuli The arrival of a new breed of buyers, combined with intense global competition, has led Indian galleries to change their style of operation. A look at the big players of this specialised game: Neville Tuli of OSIAN's has been at the helm of this radical change in attitude. He wrote books, pre-sold and published them himself, set up an enviable archive and documentation centre, started India's first indigenous art auction house and is now launching an art fund. Passionate and volatile, Tuli has both rabid detractors and adoring admirers in the art world. The Times of India Group, with its vast spread and resources, has been an important collector of Indian art. Tyeb Mehta is one artist it promoted by selectively putting up his work Celebration for sale at Christie's three years ago, backing it with a blaze of publicity. The work fetched what at the time was a record price of Rs 1.42 crore. The group recently appointed Ashok Sen curator to catalogue its collection. The new face of gallerists is perhaps best represented by the youngest in the trade. Roshini Vadehra, the 23-year-old daughter of Arun Vadehra, of Vadehra Gallery, is smart, connected and on the ball. She likes the younger conceptual artists and is considering opening a gallery in London on the one hand and bringing European masters like Picasso and Matisse to India on the other. The one gallerist who is largely responsible for the price hike is Amit Judge of Bodhi Art. With branches in Delhi, Mumbai and Singapore already opera-tional, he is in the process of opening a 6000-square-foot space in Manhattan. Dinesh Vazirani of Saffronart.com is the invisible gallery man who has ingeniously created the world's best online model for art sale. In just two years, he has set both standards and records for online sales.

So where is this market heading and how does it compare with comparables from America, Europe and China? Well, as per their last sales recorded on the Internet, American abstractionist Robert Rauschenberg sold for Rs 49 crore, while Britsh master David Hockney and Chinese artist Xu Bing sold for Rs 12 crore and Rs 1.8 crore respectively. Those figures might not look too remote to achieve, "but in the total volume of national art sales we have a lot of catching up to do with Brazilian, Mexican and Chinese art markets," says Vadehra. However, with proper promotion and support infrastructure, there is no reason why the Indian art market should not grow at a rate of 20-30 per cent annually. Of course, as it matures, there will periodically be a culling and a levelling out as is bound to happen in any economy.

Consider a conversation between one of the writers with someone who owns a resplendent work by the writer's father J. Swaminathan, and is keen on buying a flat in Delhi's fashionable enclave overlooking Humayun's Tomb, but could not afford it. When a Swaminathan work hit Rs 3.57 crore at Sotheby's, the writer called her and said, "Now you can sell your Swaminathan to buy that flat you have always wanted." "Silly boy," she replied, "Now I'll wait another few years and buy the tomb itself." Amen.

-With inputs from Anil Padmanabhan in New York

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