The Bombay Stock Exchange launched India's first carbon efficient index on Wednesday, aiming to provide a benchmark for socially aware investors.

The 20-share BSE-GREENEX includes some of India's leading companies such as Tata Motors (TAMO.BO), Tata Steel (TISC.BO), ICICI Bank (ICBK.BO), Larsen & Toubro (LART.BO), Housing Development Finance Company (HDFC.BO), Reliance Infrastructure (RLIN.BO), Dr Reddy's Laboratories (REDY.BO) and DLF (DLF.BO).

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.

The index can be used to develop green financial products including mutual funds, exchange-traded funds and structured products, the BSE said.