Investment prospects in art and culture

Creativity emerged in the mid-20th century and gained prominence in policy discussions in the late 1950s. In the 1990s, economists and policymakers viewed economic activities through the lens of creativity, leading to the term “creative industries.” Cultural industries, like dance, music, film, and visual arts, are crucial for economic growth and employment, contributing to Sustainable Development Goals and addressing poverty, inequality, gender disparity, and urban development.

India’s creative economy is crucial, with communities contributing to its cultural legacy through products and services like architecture, dance, festivals, handicrafts, literature, and music. India has some of the oldest surviving dance and music forms, ancient literature and magnificent architecture. The country’s elaborate festivals honour old traditions and mythologies, promoting cultural cohesion and benefiting the local economy.

According to a few studies of 2021, for instance, the Durga Puja festival in West Bengal holds significant cultural and economic value, contributing 2.58% of the state’s GDP for the 2019-2020 fiscal year. India has the sixth-largest number of UNESCO heritage sites, diverse natural landscapes, and diverse cultural traditions. As the fastest-growing large economy and information technology hub, India can harness its culture as an asset and expand its global footprint. Creative industries are activities originating from individual creativity, skill, and talent, with the potential for wealth and job creation through intellectual property generation. In the UK, thirteen sectors are identified as Creative Industries, including advertising, architecture, arts, antique markets, crafts, design, designer fashion, music, interactive leisure software, performing arts, publishing, software and computer services, television and radio, and film and video. John Howkins developed the concept of creative economy in 2001, defining it as “the transactions of creative products that have an economic good or service that results from creativity and has economic value.” 15 industries contribute to the creative economy by producing goods and services that result from creativity and have economic value.

The Indian creative economy has largely potential to capture consumers around the world. It is necessary to have an economic approach with a PPP model involving the local artist community to preserve the richness of traditional heritage as it is. The Economic approach to creativity includes studies focusing on innovation-driven creative industries, including arts, technology, and science, as well as cultural, service, and knowledge-based industries. The Indian economy needs intervention in Cultural value chains interconnecting the process of creating, producing, potentially manufacturing, or reproducing a cultural good or service. These value chains are not just economic practices but also represent cultural values for communities. In India, these value chains are critical as they link the organised and unorganised sectors by transmitting culture and creativity from local communities to large industries and eventually reaching the end consumer. For example, the handicraft sector in Bidri, Telangana State, consists of small and marginal craftsmen working in an unorganised setup. Their output is sold through intermediaries to production houses, who process it before distributing it through domestic retailers, NGOs, or government agencies for exports.

Challenges

India’s creative economy faces measurement challenges due to a lack of reliable data and the informal sector, involving creative workers like folk artists, local artisans, handicraft workers, and contractual staff. Without data, it becomes difficult to account for these contributions, making it a contemporary and unorthodox sector.

Many artists and creative actors, especially in developing countries like India, need more financial support, limiting their global reach and cultural exchanges. The G20 could provide mobility grants to artists and creative workers, allowing them to travel internationally and experience diverse cultural exchanges. This could be India’s opportunity to present a proposal at the G20 table. Additionally, countries could collaborate on creating a digital platform for creative and cultural workers, enhancing their visibility and integrating culture into their economic and social development strategies.

Investing in the Indian creative economy offers numerous benefits, including high growth potential, job creation, innovation, and positive social impact. India is one of the largest employers in the sector, and it is expected to create more jobs in the future. The creative economy also fosters social inclusion, gender equality, and environmental sustainability. Investors can invest in individual creative businesses, creative clusters, or creative funds, which invest in a portfolio of creative businesses. Overall, investing in the Indian creative economy is a wise choice for a successful and sustainable future.

Profitability of art investments

The profitability of art investments is influenced by the rarity and uniqueness of the artwork, as well as the art’s cultural significance and historical context. The increasing value of artworks is attributed to factors such as the growing appreciation for art as an investment, the limited supply of high-quality artworks, and the influence of globalisation and international art transactions. The art business in India offers a promising growth and development opportunity for entrepreneurs and investors, as it possesses rich cultural traditions and artistic heritage.

India offers numerous investment opportunities in art and culture, providing a promising space for entrepreneurship and financial growth. The art business offers numerous investment opportunities for individuals seeking a profitable and culturally enriching venture. With the growing interest in art and culture, the demand for unique artworks is rising, creating a favourable market for investors. Art investments can yield substantial returns, particularly with the right approach and expertise. Additionally, investing in art provides diversification to an investment portfolio and reduces the risk associated with traditional investment avenues. The art business contributes to preserving and promoting cultural heritage, making it a socially and culturally significant investment.

Various avenues for investment

Art galleries and museums serve as hubs for investors, while online platforms and e-commerce websites offer convenient art sales and auctions. Art funds and investment firms provide alternative investment options for diversifying portfolios and capitalising on the growing demand for unique artworks. The art ecosystem in India is essential for creative, art, and cultural entrepreneurship, and understanding the scope of the art business and investment is crucial for entrepreneurship. India’s favourable demographics and urban population create a conducive environment for investment in the art sector. Recognising the potential of art businesses and investments in India is essential to tap into this untapped market.

Conclusion

India’s creative, art, and culture entrepreneurship presents vast opportunities due to its rich cultural heritage and diverse artistic expressions. The growing middle class, technology, and interest in art and culture create a favourable environment for the art market. Entrepreneurs must engage in innovative business practices, collaborate with artists and institutions, and tap into domestic and international markets. Strategic planning and talent nurturing can help the art industry thrive and contribute to the country’s economic growth.

(The writer is an Assistant Director on deputation with the National Gallery of Modern Art, Ministry of Culture, New Delhi)