Osian's Auction Catalogue India The Passionate Detachment | February 2001

21 Pricing art is a very contentious issue, the world over. To place value on artistic intangibles is always difficult. The credibility of any such process will have skeptics, and rightly so. It is not my intention to discuss in detail such aspects here, only to highlight one important financial factor in the pricing of Indian modern & contemporary art: the advantages of purchasing from a curated auction, especially one which takes into account the history of the subject in a credible manner. At this stage of relative infancy in the market for Indian modern & contemporary art, it is my clear belief that a very significant and sustainable appreciation in prices will occur. This appreciation in art’s market value will moreover be large enough to generate sufficient wealth through which an entire infrastructure to support the contemporary arts can be funded in the medium term, if carefully ploughed back. Factors such as those listed below will converge to increase the value of works of art: - the rapidly increasing rarity of a fixed supply of old historically significant works of art; - the immense increase in the purchasing power of the Indian outside India, especially in the USA and South East Asia, with a concomitant relative disregard for paying ’high’ prices in the pursuit of good-quality rare works of art; - the change in the collector profile which implies that works of art which are entering new collections are not likely to be resold in the near future, unlike the present period of selling from old collections in need of liquidity; - a far greater awareness of the history of the subject and the relevance of individual artists in this context, which in turn allows the public to discriminate in a positive direction; - this factor of discrimination will also lead to greater volatility, especially in the Indian scenario where a vast scale of mediocre art always prevails; - an increasing public respect for the well documented and intelligently published books as a significant contributor in establishing artistic credibility; - the increasing transformation of the black into white economy aspect of purchasing, which in turn will allow ever greater involvement of financial entities and their mechanisms of escalating the generation of wealth, irrespective of short term blips which may occur due to greater tax accountability and administration; - the increasing chance of the Indian economy growing as a whole in the international context, though art travels well during times of depression. A credible curated auction, in trying to be true to the historical relevance of the art works or the artists included, and by trying to maintain a certain standard of aesthetic integrity, will naturally achieve a degree of pre-selection which normal auctions avoid or cannot fulfill. I will not labour this aspect of pre-selection, but instead present a sample of prices achieved in two previous auctions, curated by myself through HEART. If those works sold were to be purchased today, the level of appreciation is clear for all to see. (Refer pp22-25). It should be further stressed that these auctions did not have a large selection of the traditionally popular artists such as M.F.Husain, Anjolie Ela Menon, Manjit Bawa, Tyeb Mehta nor any emphasis on the ’pretty picture’ concept. If anything most works chosen were angst ridden and morose in mood, focusing on media such as pen and ink on paper, or emphasizing the black and grey tension of life, as with the majority of works in this auction. Further, many were market-making exercises, introducing artists or periods of work for the first time in a public auction. The key factor for the sustainable financial appreciation is that the intellectual homework and the aesthetic eye were genuine. Confidence in these two factors alone is enough to guarantee a stability in investment. FINANCIAL VALUATION BSE Sensex INR/US $ Art* Value on 15/11/1997 3569.77 36.74 Value on 28/11/1999 4783.10 43.36 Value on 05/12/2000 4070.55 46.54 Appreciation/Depreciation 4.68 (-) 8.90 31.28 1997-2000 (3 years) (Simple Annualised %) Appreciation/Depreciation (-) 14.90 (-) 7.33 57.44 1999-2000 (Simple Annualised %) *Art appreciation values are estimated not actualized values. Further, the disadvantages of investment in art, from a relative lack of liquidity, transparency and financial documented facts, must be taken into account, along with all legal aspects of it still being a fledgling asset. A PRICE ANALYSIS OF HEART’S CURATED AUCTIONS 1997 & 1999 As per attached statements