The Andaman & Nicobar (A&N) Islands, located in the Indian Ocean, are a group of 572 islands in the southeastern part of the Bay of Bengal. The islands are situated close to Indonesia and Thailand.

Presence of 23 ports and an international airport in the capital city—Port Blair—makes it well connected with the rest of the world.

A mega International Container Transhipment Port is going to be set up at the Galathea Bay of Great Nicobar Island. The first phase is targeted for completion in 2028 at a handling capacity of 4 million Twenty-Foot Equivalent Units.

Development of a deep internal port draught and proposal to build a trans-shipment port in Great Nicobar at an estimated cost of approximately Rs. 100 billion (US$ 1.36 billion) will enable large ships, along with new employment opportunities, to anchor and increase India's share in maritime trade.

High-impact ventures are being extended across 12 Andaman & Nicobar Islands. To boost the North and Middle Andamans road connectivity, two major bridges and the NH-4 are under construction.

In FY23 (as of April, 30, 2023), Andaman and Nicobar had a total installed power generation capacity of 127.87 MW, comprising 92.71 MW from thermal and 35.86 MW from renewable energy sources (RES).

Rs. 5,987.14 crore (US$ 728.1 million) has been allocated to Andaman and Nicobar Islands for the Financial Year 2023-24 in the Union Budget 2023-24. 

In FY23, the total merchandise exports from the state stood at US$ 5.91 million, while during FY22, it stood at US$ 1.14 million.

The following are some of the key government initiatives to promote A&N as an investment destination:

• The government has already invested Rs. 30,000 crore (US$ 3.64 billion) in the last eight years in the Andaman and Nicobar Islands, and Rs. 10,000 crore (US$ 1.21 billion) worth of investments are in the pipeline. The government is planning to develop a trans-shipment hub, a greenfield airport, a township, and a diesel/solar power plant as part of a mega infrastructure boost to the strategically located island chain.
• According to the Telecom Regulatory Authority of India (TRAI), Andaman and Nicobar had 0.52 million wireless subscribers and 0.04 wireline subscribers, as of December 2022.
• In December 2022, India and Indonesia held a meeting on the development of connectivity between Andaman and Nicobar Island and Aceh Province.
• As of March 2022, the Japan International Cooperation Agency (JICA) and the Government of India signed a grant for a power supply project in the Andaman and Nicobar Islands worth Rs. 250 crores (US$ 32.54 million).
• In July 2021, Dr. Jitendra Singh, Minister of Science & Technology, and Earth Sciences stated that satellite communication is being used for beaming educational content in digital mode amid the pandemic in Andaman & Nicobar Islands.
• In August 2021, under the Marine Aids to Navigation Bill 2021, traditional and historical values of lighthouses would be preserved and showcased as part of the initiative. Thus, the government identified 65 lighthouses to become a tourist spots. Lighthouses in Andaman And Nicobar Islands have been identified under this initiative to boost tourism.
• In March 2021, the Union Ministry of Home Affairs (MHA) announced that it is vetting 41 proposals for projects from various sectors including road construction, hospitality and industries in Andaman & Nicobar Islands and Lakshadweep.
• In March 2021, the Government of India announced that it would set up four water aerodromes in the Andaman & Nicobar Islands to develop the union territory as a tourist destination so that it can be on par with Maldives and Mauritius.
• In October 2020, Andaman and Nicobar administration opened tourist activities in South Andaman, while the North and Middle Islands are still closed for tourists due to COVID-19.
• The Indian government has set a target for Andaman and Nicobar to attain 100% of its energy needs through renewable energy
• Development projects have been launched in the A&N Islands by the National Bank for Agriculture and Rural Development (NABARD) to improve the Atmanirbhar Bharat concept through rural entrepreneurship. This will concentrate on the creation and skills growth of self-help groups (SHGs) to facilitate micro-level rural entrepreneurship.
• To attract investment and technological & management expertise from the private sector, four tourism-based projects in the Andaman & Nicobar Islands were developed for implementation through the Public-Private Partnership (PPP) mode.
• In August 2020, Prime Minister Mr. Narendra Modi inaugurated the Submarine Optical Fibre Cable (OFC) for better connectivity in A&N.
• High-impact ventures are being extended across 12 Andaman & Nicobar Islands. To boost the North and Middle Andamans road connectivity, two major bridges and the NH-4 are under construction.
• Port Blair Airport is being renovated to accommodate 1,200 passengers. In addition, the airports are ready for Diglipur, Car Nicobar and Campbell-Bay operations.
• Four ships being built at the Kochi Shipyard are likely to improve water connectivity between the islands and the mainland.