The New Economic Policy, implemented by the Indian government in 1991, induced a phenomenal boost in economic productivity and a tremendous rise in entrepreneurship. Privatization aided in relaxing trade restrictions set by nationalist sentiments and in reducing tax rates. India finally entered the competitive world of art by opening up trade opportunities within the global market. Some of the chief consequences of cultural amalgamation that globalization brought in were directly visible through rapid economic growth, increased productivity and the birth of the nouveau-riche class of Indians. The 2000s have been a tumultuous period for the contemporary Indian art market as it has both, seen a rise to unprecedented heights, as well as experienced financial turmoil brought on by the collapse of Lehman Brothers in 2007. This dissertation explores the factors that led to the change in the language of Indian art and outlines the emergence of contemporary art in India and analyzes the factors that attributed to the rapid and unsustainable escalation in prices, which resulted in the boom. Further, it argues the effects of the crash and the reason for the slow recovery and contemplates effective solutions that could develop the market in a sustainable manner and the role of the key stakeholders in implementing these solutions.