India’s first energy efficient index promoting investments is launched by the BSE. A unique initiative which drives in investments to foster the sustainable business practice is welcome.

The Bombay Stock Exchange launched India's first carbon efficient index BSE - GREENEX on Wednesday, at Mumbai, by Corporate Affairs Minister M Veerappa Moily. This initiative of the BSE is the second thematic index by the BSE. GREENEX promotes better carbon standards practices in increasing the efficiency of the companies adhering to the prescribed global standards. It would be a benchmark for socially aware investors.

BSE Ltd. in association with gTrade (supported by GIZ promoted by Federal Republic of Germany, Observer Research Foundation and IIM Ahmedabad) has constructed BSE-GREENEX - designed specifically to promote green investing, with emphasis on financial performance and long term viability of companies.

The 20-share BSE-GREENEX includes some of India's leading companies such as Tata Motors, Tata Steel, ICICI Bank, Larsen & Toubro, Housing Development Finance Company, Reliance Infrastructure, Dr Reddy's Laboratories and DLF. The index gives equal weightage to both energy efficiency and profitability — together indicating a long-term sustainable strategy.

Reuters quoted that, "The cost of carbon-based energy production is increasing, and if companies become more efficient and reduce energy costs there is a chance of higher profitability," said Ashishkumar Chauhan, BSE's deputy chief executive officer. "There are many socially aware investors willing to pay a premium to invest in green companies in the hope of getting better returns," he added.

India’s premier business daily Business Line quoted as, the index is targeted at retail, as well as institutional investors such as asset managers and pension funds looking for investments in companies with strong long-term prospects and develops green financial products.

Quoting are given here for reader enrichment and for details, please refer to the BSE’s official statement on the issue.  (With inputs from internet: AarKay)