Entrepreneurs and young professionals, the biggest beneficiaries of India's financial prosperity, are buying works of art both to signal they have arrived in life and as a safe- haven investment.

The trend was on show at a Bangalore sale to snap up works by modern Indian artists such as Maqbool Fida Husain, Jamini Roy, Vasudeo Gaitonde and FN Souza.

"The interest in art is part of the lifestyle change we are witnessing," said Maher Dadha, chairman of Bid and Hammer Auctioneers, who estimated the minimum value of the combined collection at 100 million rupees (HK$19.78 million). "Wealth has percolated down and people are buying art just like they are buying penthouses," he said.

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The hammer went down on a 1971 Husain watercolor on paper, entitled Shiva, at 3.4 million rupees, the top price paid at the auction. At the start of this decade, Husain's works fetched less than 600,000 rupees.

Auctions of modern and contemporary Indian art have raised millions of dollars overseas in recent years, with Christie's selling a Tyeb Mehta painting for US$1.6 million (HK$12.48 million) in 2005.

"Now it's an internal trend, where Indian art is getting recognition in India itself," Dadha said, adding that India's rich "don't blink for a moment over cost."

Economic growth running at an annual 9 percent, a stock market that rose a record 47 percent last year and surging salaries for finance and technology professionals have created a middle-class clientele for art.

Collecting Indian art has been traditionally a pursuit of former maharajahs, industrial houses, overseas collectors and rich expatriates. The local art market - both gallery sales and auctions - is worth between US$400 million and US$450 million and expanding as prices jump, said Arun Vadehra, owner of Vadehra Art Gallery in New Delhi and a consultant to Christie's.

Gallery sales have jumped from barely US$2 million in 2000 to US$150 million, said Vadehra.

"The art market is very hot," said Indian art critic Ella Datta. "The collector base is growing with lots of people like doctors, lawyers and IT professionals who can afford art coming into the market. The vaster base should sustain the market's growth. I don't see it crumbling."

According to Bid and Hammer, the most renowned Indian art currently delivers solid annual returns of 35 percent.

"Eight years ago, I bought a Jaya Jhaveri for a small throwaway price and today it is worth at least 100,000 rupees," said Bangalore entrepreneur Sudhir Udayakanth. "Today art has become an investment."

In 2006, auction house Osian's raised 1.02 billion rupees for a fund dedicated to art, luring investors with the promise of converting the country's cultural wealth into capital assets.

The fund was open to those capable of depositing at least one million rupees for three years. Osian's paid a dividend last year, becoming the world's first art fund to share income with investors.

AGENCE FRANCE-PRESSE