How India and China Are Redefining the Global Art Market

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Since I joined Sotheby’s in 2003, I had the good fortune to witness two of the biggest moving markets in 21st century auction history, those of contemporary and modern Indian and Chinese art. Visits to art galleries in Mumbai and Delhi are now par for the course for museum groups and upscale tour groups visiting India. In Beijing as well, the 798 Art District is a must for all tourists these days. Change has occurred very rapidly, and we have a lot to learn from our clients’ preferences and tastes, which can change pretty quickly.

In the Hong Kong sale that we had earlier this year, the most popular selling category was wine. We sell Chinese art in Hong Kong, traditional and modern. We sell jewellery, watches and wine. But wine was the most popular. So the point I’m trying to make is that in these new markets you never can make assumptions. You cannot make assumptions. You have to keep your ear on the ground. You have to keep your eyes open. And you have to modulate your strategy according to what the client wants, what the buyer wants.

By the way, at Sotheby’s, we do not call India and China emerging markets. We call them new markets. Because at this moment, these markets have emerged, and they’re actually at a phase of maturity in their growth cycle.

In 1995, a selection of 219 paintings from their collection was offered for sale at Sotheby’s New York to benefit the Chester and Davida Herwitz Charitable Trust, and Indian art was catapulted onto the international auction arena. Now, in preparing for this auction, my colleagues at Sotheby’s had no existing database of buyers to rely on.

So they went to the Manhattan telephone directory, among other things, looking for the names of Indian doctors and so forth to try to build a list of recipients for a catalogue. So this is what we do in the auction world. This is what we do in auction houses to create a market. It doesn’t come out of the vacuum.

Saffronart, India’s first online auction house, and Osian’s, India’s first homegrown auction house were founded. These businesses were dedicated solely to the promotion and sale of modern Indian art. Saffronart’s success coincided not only with the rise of internet usage in India, but also with the liberalisation of the Indian economy, which was in full swing by this time, resulting in the creation of new wealth in India.

2005 was a watershed year because it marked the moment when the market really took off. Most importantly, it had become clear that Indian art had now become an asset class. A number of art funds were established in India, and they were aggressively acquiring assets for their investors.

In 2006, an iconic work by Damien Hirst would cost anywhere between $500,000 to a million dollars. But you can get an iconic work by Subodh Gupta for $100,000 or a little bit over. So this is a big difference in value. The price differential made contemporary Indian art a very attractive buy to international buyers.

Between 2007 and ’09, the modern Indian art market experienced its peak, and is currently entering its mature phase, as I said. So this is where demand was outstripping supply. Now it’s beginning to even out and mature, so that we are controlling supply.