You still perhaps can’t pluck Monet’s Water Lilies or Van Gogh’s Sunflowers for your walls. But you can buy a lot more art being sold abroad than earlier, especially if you are a big, fat Indian family.
The Reserve Bank of India has doubled the cap on individual overseas investment from $100,000 (Rs 39.7 lakh) per person annually to $200,000 (Rs 79.4 lakh). So, if you are a wealthy family of five, that makes it a million dollars to buy with.
Warhol’s Campbell Soup at $130,000 (Rs 52 lakh) for entrée, Dali’s La Montre Molle at $670,000 (Rs 2.68 crore) for the main course? That still leaves $200,000 for desserts.
The central bank’s generosity gives a rapidly globalising and prospering India another reason to go art shopping, with investment in paintings and artefacts increasingly providing marzipan to oven-hot stock market gains. Popularity of art investment made the government consider a painting as capital good and tax dealings on it since the last budget.
“For alternative asset classes like art or real estate, this hike will be very useful,” said Nipun Mehta, CEO of Unitis Tower, a wealth management company for high net-worth individuals. “$1,00,000 was not enough.”
He said mutual funds and equity investments overseas would happen only after a person has invested enough in India, since the Indian equity markets are giving excellent returns. Also, the dollar getting weak is a disincentive to invest abroad.
Now, investors would make a bigger beeline to buy North American art, said Niyatee Shinde, curator of Gallery Articulate, which is run by the Yash Birla group.
“For about a decade, people have started following US aesthetic trends. Earlier, the scene used to be dominated by European art, be it Renaissance or the German Impressionists,” she said.
But Patel said Indian paintings being sold abroad would be a popular choice for Indian investors. “Best Western art can cost $20-50 million. Indian paintings go up to around $1 million. Also, Indian collectors understand Indian art better.”
Several new art-funds for globally traded Indian art are set to launch. Osian is coming up with one by end-2007, while Religare’s fund may take off earlier.