With “one hand on the steering wheel and the other on their smartphones ready to tweet,” as described by India’s Telegraph newspaper, frustrated farmers in Mandsaur (Madhya Pradesh) are leveraging communications technologies to fight perceived social and financial injustices. The farmers’ movement embodies the pervasive, decentralized nature of social movements that air grievances and increase instability both in India and around the world. Investors, especially members of the Indian diaspora, are uniquely positioned to employ social risk analysis and targeted investments to simultaneously mitigate unrest, maximize social impact, and increase financial returns.
The greatest threats to long-term stability in India are rooted in social risk.
Social risk is the increased potential for instability through population-based grievances and social tensions that manifest as people struggle to acquire basic needs. When grievances and needs are left unaddressed, social risk increases and seemingly insignificant events can trigger protests, strikes, litigation, looting, work stoppages, and other violence. Social risk is accelerated by booming population growth, rapid developments in telecommunications technologies, and changing ideologies, which disrupts traditional social structures in India’s rigid, religious, and caste-based society.
India’s social risks are ready to explode: one wrong text, press release, or mismanaged event can ignite the powder keg. Widespread use of social media enables people to share ideas, disseminate narratives, and rapidly mobilize around a common cause. Kerala’s beef ban and Tamil Nadu’s jallikattu protests illustrate the ways social media amplified emotions, shaped public perception, and influenced event outcomes. Moreover, individuals, activist groups, and terrorist organizations leverage these platforms to take advantage of people’s fear and anger by offering alternative narratives that lead to insecurity.
Unbalanced economic development will continue to heighten social tensions and lead to further unrest.
Indian society is at a tipping point. Citizens struggle to balance traditional cultural systems with new social dynamics introduced by globalization. Social unrest and mass protests are increasing in frequency and magnitude. In August 2017, over a million protesters in Mumbai shut down India’s financial center, demanding improved education and increased job opportunities. Unbalanced economic development, corruption, gender inequality, and caste conflict are just some of the social risk factors that foment unrest.
Private sector initiatives, specifically those led by the Indian diaspora, are well-positioned to address these unique challenges. Stakeholders with historic ties to India have an emotional connection to investments and the country. They understand that geopolitical analysis does not always accurately represent ground-truth. They also know that for every dollar of investment, there is a greater impact for individuals and communities where basic needs are scarce, competition for resources is fierce, and grievances often go unaddressed.
A population-based approach that employs social risk analysis delivers an effective alternative.
Social risk analysis for diaspora investment begins by examining the nuances of Indian identity. Caste, religion, gender, education, income, and age are all factors that shape the identities and world views of individuals. Understanding individual and communal identities enables diaspora investors to pinpoint and address the specific grievances and needs of each community in which they invest.
A population-based investment approach, focused on social risk analysis, lays the foundation for successful investment. It uncovers, monitors, and forecasts social risk factors that underpin unrest. It allows investors to link critical social risk factors to related social issues and design effective solutions. For example, Indian gender violence is prevalent among uneducated boys and young men, who do not regularly attend school. The Akshaya Patra Foundation has found success offering free lunches at schools in order to increase enrollment and keep boys off the streets. To address both gender violence and poor education, the Indian diaspora may invest in the production of ‘roti’ (Indian flat bread) to support similar programs.
Social risk analysis provides Indian diaspora a tool to join the conversation about contentious social issues, address community needs, and reduce social tensions. It creates positive change in dynamic social environments where traditional investments often fail to deliver enduring social impact. Most importantly, examining societal challenges and financial opportunities through a social risk lens enables investors to identify, track, and forecast the constantly evolving social risk factors across India’s complex society to address community needs and maximize investments.
Editor’s note: This post was co-authored by Aswin Subanthore, vice president (South Asia) at ENODO Global, Inc., a risk advisory firm that conducts population-centric analysis to solve complex social problems in dynamic cultural environments. View the original post here.