What makes the Rs 90,000-crore Great Nicobar Island project critical for India both militarily and economically
Spread across 166 sq km in the Andaman and Nicobar Islands, the project includes the development of a transshipment port, an international airport and associated logistics and urban infrastructure near the Malacca Strait, one of the world’s busiest maritime trade corridors.
The proposed transshipment port is planned with an eventual handling capacity of 16 million containers annually. In the first phase, expected to be commissioned by 2028 at a cost of Rs 18,000 crore, the port is projected to handle more than 4 million containers per year.
The initiative is being viewed as a key component of India’s broader maritime strategy and its efforts to strengthen its role in the eastern Indian Ocean amid changing regional and global dynamics.
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Malacca Strait central to global oil trade
The strategic importance of the project is closely linked to the Malacca Strait’s role in global energy and trade movement.
According to the US Energy Information Administration, the Strait of Malacca is the primary chokepoint in Asia and Oceania and the world’s largest oil transit chokepoint by volume. Around 23.2 million barrels per day of oil passed through the strait during the first half of 2025, accounting for nearly 29% of global maritime oil flows.Crude oil constitutes more than 70% of total shipments through the corridor, with most supplies moving from the Middle East to East Asian countries. China accounted for 48% of import volumes passing through the strait during the first half of 2025.
The report also noted that oil flows to India from Russian ports have increased in recent years following US and European Union restrictions on Russian oil imports, although traffic through the Malacca Strait varies depending on shipments from Russia’s Pacific coast to India.
The Andaman and Nicobar Islands’ location near the strategic waterway is considered critical for monitoring maritime trade and naval movements in the region.
Defence veterans back project
Several defence veterans have publicly supported the Great Nicobar Project, describing it as strategically important for India’s security and economic interests, reports TOI.
Former Air Chief Marshal RKS Bhadauria dismissed criticism of the project and said it was crucial for India’s national security, economic growth and military presence in the region. He highlighted the island’s strategic location near the Malacca Strait, which he described as another critical chokepoint after the Strait of Hormuz.
Bhadauria said nearly 80% of China’s oil imports and a significant share of its cargo pass through the Malacca Strait. He added that India requires a strong economic and military base in Great Nicobar amid China’s growing naval presence in the Indian Ocean Region.
His remarks came after Congress leader Rahul Gandhi alleged that the Great Nicobar project at Campbell Bay was “one of the biggest scams and gravest crimes against the natural and tribal heritage of the country”.
Major General (Retd.) GS Rawat also supported the initiative, stating that the project must be viewed from an operational and strategic perspective, including its maritime positioning. Referring to recent tensions in West Asia, he said global developments had demonstrated how strategic chokepoints such as the Strait of Hormuz could be exploited.
Lt Gen (Retd.) Rajeev Chaudhry, former Director General of the Border Roads Organisation, cautioned that delays in the project caused by environmental opposition or international pressure could benefit China.
He said Beijing was wary of the project because it would improve India’s ability to monitor maritime trade and military movements in the region. He also referred to China’s “String of Pearls” strategy involving ports such as Gwadar, Hambantota and Kyaukpyu, and said a strong strategic and economic hub at Campbell Bay and Galathea Bay would help counter those efforts.
Chaudhry added that opposition or negative narratives surrounding the project could inadvertently align with Chinese strategic interests and said the initiative should have been implemented earlier.
Project aims to reduce reliance on foreign ports
The Great Nicobar Project aims to reduce India’s dependence on foreign transshipment hubs such as Colombo, Singapore and Dubai, which currently handle a large share of Indian cargo traffic.
The proposed port is expected to improve supply chain resilience, reduce logistical inefficiencies, and strengthen India’s role in global shipping and trade networks.
The project also marks a broader shift in India’s maritime strategy, which for decades remained limited by the underutilisation of island territories while policymaking focused primarily on continental security concerns.
Environmental and sustainability concerns remain
At the same time, the project has triggered concerns regarding environmental sustainability and the impact on indigenous communities living in Great Nicobar, which is home to ecologically sensitive habitats and rich biodiversity.
The initiative has intensified discussions on balancing infrastructure development with environmental protection, sustainable planning and the preservation of tribal heritage.
Experts have stressed the need for transparent environmental assessments, mitigation measures and meaningful engagement with local communities during implementation.
Technology and Indo-Pacific connectivity
The project is also expected to support advanced logistics systems, AI-driven supply chains, smart port infrastructure and sustainable energy integration.
Supporters say the initiative could strengthen India’s connectivity with Southeast Asia and reinforce its role as a strategic bridge between South Asia and the wider Indo-Pacific region.
Execution key to long-term impact
If implemented successfully, the Great Nicobar Project could emerge as a major symbol of India’s maritime expansion and its growing strategic role in the Indo-Pacific region.
While concerns over execution timelines, governance challenges and rising costs continue to remain given the scale and complexity of the initiative, proponents argue that delays in strengthening India’s maritime infrastructure could carry strategic consequences in a rapidly changing global order.
