I cant give you a definiton Suede, but I can try and explain what I understand of the term.
India is the world's largest democracy and is also an example of just this particular form of governance, except in the past decade or so, ever since free market principles have slowly seeped in. A Socialist Democracy is one where the people elect their government but the overall policy of the government, irrespective of the party that is elected, will be, to have some regulatory control over trade, commerce and the economic markets. This government policy is effected as a protective measure to prevent against a widening of the rich-poor gap and to also give the people that are poorer, a fighting chance to improve their lot. With specific reference to India and China, this is a serious concern, because of the large populations involved.