India Needs to Transit from an Open Market Economy to a Socially Responsible Market Economy

Umesh Upadhyay

By Rajiv Tewari, Consulting Editor,, based on a conversation with Umesh Upadhyay, President and Media Director, Reliance Industries. Full introduction of Umesh has been shared at the end of this article.

Open market economy contributed to converting the world into a global village and benefitted all of us in several ways however there is a need for a fundamental transformation to a new model. Old ways of doing things need to change for nurturing sustainable growth, securing jobs, and increasing competitive abilities in a way that does not adversely affect the environment and generate further inequalities.

The concept of businesses built on economies of scale, with profit maximization at all costs, needs to be challenged. This model of economy has created a situation where half the world’s wealth is now in the hands of just 1% of the population.  This has fuelled huge inequalities across the world and has generated a lot of social unrest. Evaluating prosperity only by the GDP growth is not enough. Measurement of prosperity should include peace, happiness, financial well-being, liberty and freedom too. In other words, we require a combo of economic and social prosperity.

We need a differentiated model in the new age

We need to encourage a model of wealth creation that does not harm the society’s interest by polluting our environment and adversely affecting areas like healthcare, education and social harmony.  The world needs a differentiated model of economic growth which is capable of reducing the vast inequalities & safeguarding the interests of the society as a whole. Developing countries like India are already witnessing an alarming situation due to the old model’s impact on its society. Delhi’s air has become so polluted due to mindless growth and the old practice of burning the crop waste that one of the maximum selling items at the chemist shops is now the anti-pollution mask. Water sources are polluted so badly that almost every family, which can afford it, has a water purifier at home while those who can not afford these costly gadgets are vulnerable to diseases.

How much can CSR & Charity really contribute?

CSR by the corporate world is a commendable step but not good enough to suit the needs of a large and diverse country like India.  A lot of charity money too is being routed through philanthropic organizations but its effective utilization is under a question mark.  In spite of the best intentions of the trustees, it is sad to see the poor management of many charitable hospitals, educational institutes and other organizations meant to serve the society in a meaningful way.

In earlier times, the concept of charity, in India, was based on the ideal of giving what was most valuable to a person. In our times most valuable things like clean air, pure water, right to education & good healthcare are all being taken away from us & in return some amount is apportioned for social good. This does not add up to a healthy equation. Real CSR would mean a complete overhaul of the processes which need be in alignment with the best interests of the workers, consumers and the society at large and not just some spare change spent under the CSR schemes.

Charities & not for profit sectors too need a new age model

The charities and not for profit sectors too need to exit the industrial age mind set and adapt a new age model. For example, it’s sad to see how over-regulated our education system is. Instead of focusing on the quality of education, the entire regulation seems to hover around monitoring of brick and mortar structures. This is one sector which can easily go virtual and can multiply capacities for reaching every village in our country.   In contrast, the Skill India initiative is a step in the right direction in this area as its focus is more on output testing rather than infrastructure monitoring.  Mainline education system needs to transform itself on similar lines.

Socially responsible companies are beginning to have an upper hand in the war for talent & market shares

In the age of demand supply and information gaps, consumers & workers mostly had a passive role to play. With the arrival of the information age and due to the markets becoming increasingly global, the consumers as well as the workers have a much higher awareness level. They are more favourably inclined to work for and buy from organizations that they perceive to be socially responsible.  Everything being equal on the quality front, socially responsible companies will have an advantage over competitors in the war for talent as well as market shares.  Social responsibility is clearly emerging as the key brand differentiator.

Patanjali, Amul, Khadi and Fab India are just a few examples of local brands successfully carving out huge market shares through a model of wealth creation which does not harm the interests of the society. In fact, instead of creating disruption these organizations are significantly contributing at the grass root levels too. It is encouraging to note that the consumers are willing to even pay a premium for such brands.

Government of India has acknowledged the need

Government of India has acknowledged the need to encourage social entrepreneurs under the Skill India programme. This is a step in the right direction. Educational institutes are being encouraged to launch a course on social entrepreneurship through offline as well as online interfaces. Government is willing to consider fiscal incentives and is keen to protect intellectual property rights to promote grass root innovation. Skill India programme has also provided for inclusion of backward castes, scheduled tribes, minorities, the differently abled included the under developed regions like the North Eastern & Eastern parts of India. There is a plan to promote entrepreneurship amongst women too. If the implementation machinery is managed well then these steps will certainly help the social entrepreneurs in a significant way.


  • Check corruption to create a supportive environment for social entrepreneurs. It’s great to notice that the government has initiated some concrete steps in this direction.
  • Create an incubator scheme to encourage the organizations doing a good job at mentoring and guiding the social entrepreneurs. To check out the examples of several organizations already doing a good job in this area please refer to:
  • Give tax relief on investment in social enterprises more attractive than the enterprise investment schemes.
  • Give tax credit for social impact.
  • Social enterprises need to be treated like the mainline industry where investment is made on the basis of expected returns on growth with a long term perspective. Social entrepreneurs will have similar risks too in the form of delayed projects and losses which need to be audited and then supported for survival and growth like all other businesses.
  • Create an environment for encouraging social enterprise and social venturing among the young in the schools and institutes of higher education so that the best of the talent can be attracted in this area of national importance.

About Umesh Upadhyay

Umesh Upadhyay is a senior journalist, academician and communication professional.  Having worked for over two decades in the media and academic domains his forte lies in effective communications strategies. As a regular commentator on public issues he has an uncanny sense of understanding and analysing political, economic and social issues from a holistic perspective.   

He has done his Masters and M Phil in International Relations from Jawaharlal Nehru University (JNU) and graduation from the University of Delhi. He has done professional TV courses from FTII, Pune, Asian Institute for Broadcasting Development (Kula Lumpur), BSky B (London), Thames Studios (UK) and CPC, Delhi among others.

He has had experience of working with Delhi University, Press Trust of India (PTI), Doordarshan, Zee News, SAB TV, Home TV, Disha Education Society, Reliance Industries Limited and Network18.

Starting his early career as a lecturer in Delhi University, he shifted to media and has held senior positions in various News channels including Channel Head, Editor, and Executive Producer etc. He has conceived, produced and presented many pioneering programmes during his career in media.

He has reported many events live on TV and continues to write. He, as a reporter, has visited and covered many trouble torn spots in India including Jammu & Kashmir, Punjab, Assam and Kargil. He has also handled several international assignments.

He is presently working as President and Media Director in Reliance Industries Limited (Since October 2015). Earlier He worked as President News with Network18.

He is a member of the Executive Council of Mahan Lal Chaturvedi National University Journalism, Bhopal. He is also member of the Governing Body and Executive Council of the Indian Institute of Mass Communication (IIMC), New Delhi. Umesh is also member of various professional bodies and institutions such as Editors Guild of India, Press Club of India etc.