The highest-priced sale at Delhi's Indian Art Summit was made by a London gallery, while a Dusseldorf gallery generated some of the biggest crowds.
Faced with market paralysis in the art world's traditional centres, international galleries came last week to India's largest art fair, hoping to benefit from the country's healthier economy.
"We thought it was very positive and people seem to be taking the plunge," says Michelle D'Souza, the director of London's Lisson Gallery. "We've sold a very large percentage in terms of value and we have offered only very minimal discounts. We were not expecting such a response."
Ms D'Souza sold two untitled sculptures by the leading British artist Anish Kapoor, each for a rumoured price of £200,000 (Dh1.1 million). The gallery also sold work by the celebrated British artist Julian Opie.
Dusseldorf's Beck and Eggeling gallery brought a collection of Picasso etchings, hoping to demonstrate that work by some of Europe's greatest artists could be affordable.
"The Picassos have just been a complete magnet. We didn't expect this overwhelming curious interest from people," says Katja Ott from the gallery. The gallery sold one etching, Le Circle, for US$20,000 (Dh73,460).
Of the 54 galleries at the fair, 17 came from outside India, with those from established centres such as London, New York, Berlin and Tokyo joined by others from Beijing, Dubai, Bangkok, Taiwan and even Latvia.
Rob Dean, a former India representative of Christie's auctioneers who now runs London's Rob Dean Art gallery, says the fair was an escape from the gloom back home.
"From the talk here, there's an upswing in the mood, which there definitely is not in London," he says. "In London, having a gallery is the equivalent of art storage, beautifully presented art storage. People here don't think it's as bad here as they do in the rest of the world. "
Neha Kirpal, the associate director of the fair, says a lot of the western galleries "are in markets which are struggling at the moment. Here, the recession has certainly lifted. There are individuals who have walked through the door and left after buying 18 paintings."
Ms Kirpal says 40,000 people had visited the fair between July 19 and July 22, including visitors from 32 countries.
The UK's Art 18|21 and Bangkok's Thavibu Gallery sold everything they brought. As well as the major Indian collectors, Ms Kirpal said wealthy collectors from China and Korea had also been buying.
India's art market has taken off this decade as Indians who have made fortunes internationally have sought out works by the country's post-war masters such as FN Souza and MF Hussein.
The three highest prices fetched by Indian paintings all came last year, with FN Souza's Birth setting the record in June when it went under the hammer at Christie's for 112m Indian rupees (Dh8.4m).
The Indian market corrected soon after, with prices falling more than a third by the start of this year. At the Delhi fair, gallery owners said buyers were still expecting discounts.
Vikram Sethi, who helps some of India's richest build their collections, says economic statistics are a poor indicator of the buying power of Indian collectors.
"The people who buy art aren't people who are so much affected by the stock market and by the recession," he says.
"Our economy is not a true reflection of the money there is in India. India has so much money, we don't even know how much money we have. There's a lack of confidence, there's nothing else."
Mr Dean said this buying power was now increasingly looking to buy international as well as Indian art. "In the past, it's been quite difficult for domestic Indians to purchase foreign art because there were exchange regulations. All of those barriers are slowly being removed. The amount of money a private individual is able to spend overseas, I'm not sure it's even limited any more."
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Mercer, the investment consulting arm of US services company Marsh & McLennan, expects its wealth division to at least double its assets under management (AUM) in the Middle East as wealth in the region continues to grow despite economic headwinds, a company official said.
Mercer Wealth, which globally has $160 billion in AUM, plans to boost its AUM in the region to $2-$3bn in the next 2-3 years from the present $1bn, said Yasir AbuShaban, a Dubai-based principal with Mercer Wealth.
“Within the next two to three years, we are looking at reaching $2 to $3 billion as a conservative estimate and we do see an opportunity to do so,” said Mr AbuShaban.
Mercer does not directly make investments, but allocates clients’ money they have discretion to, to professional asset managers. They also provide advice to clients.
“We have buying power. We can negotiate on their (client’s) behalf with asset managers to provide them lower fees than they otherwise would have to get on their own,” he added.
Mercer Wealth’s clients include sovereign wealth funds, family offices, and insurance companies among others.
From its office in Dubai, Mercer also looks after Africa, India and Turkey, where they also see opportunity for growth.
Wealth creation in Middle East and Africa (MEA) grew 8.5 per cent to $8.1 trillion last year from $7.5tn in 2015, higher than last year’s global average of 6 per cent and the second-highest growth in a region after Asia-Pacific which grew 9.9 per cent, according to consultancy Boston Consulting Group (BCG). In the region, where wealth grew just 1.9 per cent in 2015 compared with 2014, a pickup in oil prices has helped in wealth generation.
BCG is forecasting MEA wealth will rise to $12tn by 2021, growing at an annual average of 8 per cent.
Drivers of wealth generation in the region will be split evenly between new wealth creation and growth of performance of existing assets, according to BCG.
Another general trend in the region is clients’ looking for a comprehensive approach to investing, according to Mr AbuShaban.
“Institutional investors or some of the families are seeing a slowdown in the available capital they have to invest and in that sense they are looking at optimizing the way they manage their portfolios and making sure they are not investing haphazardly and different parts of their investment are working together,” said Mr AbuShaban.
Some clients also have a higher appetite for risk, given the low interest-rate environment that does not provide enough yield for some institutional investors. These clients are keen to invest in illiquid assets, such as private equity and infrastructure.
“What we have seen is a desire for higher returns in what has been a low-return environment specifically in various fixed income or bonds,” he said.
“In this environment, we have seen a de facto increase in the risk that clients are taking in things like illiquid investments, private equity investments, infrastructure and private debt, those kind of investments were higher illiquidity results in incrementally higher returns.”
The Abu Dhabi Investment Authority, one of the largest sovereign wealth funds, said in its 2016 report that has gradually increased its exposure in direct private equity and private credit transactions, mainly in Asian markets and especially in China and India. The authority’s private equity department focused on structured equities owing to “their defensive characteristics.”
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