While Saatchi’s new show of Indian art, The Empire Strikes Back, is a talking point in London, the market for Indian art has taken some serious hits. At the height of the boom this was fever-hot, as speculators shifted from Chinese contemporary (which had become very expensive) into Indian art. Prices soared and art funds mushroomed, led by Osian’s, India’s oldest art auction house. Its Rs100 crore (£13m) fund was launched in 2006; among those that followed was the Copal Art fund, which sold investors art based on a price-per-square-foot. Between 2006 and 2008, according to the Indian business newspaper Livemint, some Rs300 crore was invested in art.

But recently Indian artists have, in some cases, lost over 70 per cent of their value, and some funds are failing to deliver promised returns. Osian’s fund closed at the end of last year, but not all investors have been paid; founder Neville Tuli told the FT that they will be paid by February 24 and admitted that the fund was “disappointing”. Osian’s is also mired in a US-based lawsuit with Christie’s, which it accuses of failing to deliver art it had bought; Menaka Kumari Shah, India representative of the firm, said: “We have been seeking to recover a significant debt from an Osian-related party for more than one year. Christie’s intends to review all of its legal remedies in response to these baseless allegations.”

The problem is not confined to art funds; Bodhi Art, one of India’s most flamboyant galleries, has become the highest-profile victim of the bust. At the height of its glory, the gallery had outlets in Berlin, Singapore, New York, Mumbai and New Delhi; now all are closed except Mumbai.

Next week, impressionist and modern art goes under the hammer in London. Christie’s goes first, on Tuesday evening with a 86-lot sale estimated at up to £80m, but the story is more about Sotheby’s sale on Wednesday. This is smaller, with 39 lots but a higher target of £102m, and it boasts three surefire winners. Giacometti’s imposing sculpture “L’Homme qui marche”, a lifetime cast from 1961 estimated at £12m-£18m, could shatter the world record for the artist. It is being sold by the German-based Dresdner, which was bought by Commerzbank last year. Cézanne’s “Pichet et fruits sur une table” (1893-94) is one of the artist’s highly desirable still lifes of apples and while it is unlikely to break the world record for Cézanne (£36.9m, made in 1999) it should still do very well at its estimate of £10m-£15m. The third cracker is a recently restituted Klimt landscape, “Kirche in Cassone” (1913), a highly attractive work with broad appeal, estimated at £12m-£18m.

Auction house specialists report a distinct loosening up of vendors’ willingness to sell, compared to last year. “We’re not talking about a return to boom times yet,” says Christie’s specialist Olivier Camu, “but buyers are buzzing around and general confidence is up.”

While some galleries may be downsizing, the international dealership Hauser & Wirth is expanding in the heart of Mayfair. The gallery has bagged the entire ground floor at 23 Savile Row, site of the former English Heritage headquarters. It will open this autumn with an exhibition of Louise Bourgeois. H&W will use the 12,500 sq ft space for larger shows, much as it did in Coppermill, the Shoreditch building where it exhibited Christoph Büchel and Martin Creed. The new gallery will bring H&W’s count of exhibition spaces to five, with New York, Zurich and three in London (its small Swallow Street space will be abandoned). So: Gagosian, eight; H&W, five, so far. The FT will publish an interview with H&W president Iwan Wirth in its collecting supplement on February 27.
“Nowhereville, USA” is one unkind description of Bentonville, Arkansas, but the town (pop: 20,000) boasts the headquarters of the world’s largest retailer, Walmart. And next year it will see the opening of Crystal Bridges museum, a $50m extravaganza masterminded by Walmart heiress Alice Walton (the sixth-richest American, says Forbes), who has been avidly collecting American art for 20 years. Some of her acquisitions have been controversial, for example when she swooped on Asher Durand’s landscape “Kindred Spirits” (1849) in a sealed-bid deal worth about $35m, whisking it away from the Metropolitan Museum of Art and the National Gallery of Washington, who wanted to keep the painting in public ownership. And she has made a $30m deal with the financially troubled Fisk University in Tennessee over shared ownership of 101 works from the Alfred Stieglitz collection, donated to the university by his estate, subject to a pending appeal by the Georgia O’Keeffe museum.

Crystal Bridges’ latest acquisition is less controversial: Walton Ford’s “The Island”, acquired from New York dealer Paul Kasmin for a sum “well in excess of $600,000”, according to the gallery. It is on display at the Hamburger Bahnhof in Berlin (until May 24) while waiting for the completion of its new home.