New Delhi, May 2 (IANS) With the Great Nicobar Project, India can convert locational advantage into economic leverage, strategic depth and maritime influence, according to a new report.

The island is remote, the project is expensive, and the execution risks are real. But the underlying logic — that geography left dormant is geography surrendered — is sound, writes Hans Kaufmann, a distinguished economist specialising in global fiscal policy, in India Narrative.

Also, Great Nicobar does not “contain” China in a military sense — the distances and force ratios make that framing unrealistic.

What it does is give India persistent observation, logistical depth, and positional leverage near a sea lane that China depends on for economic survival.

“If India builds this right, it will have made the most consequential maritime infrastructure decision since independence. If it builds it carelessly, it will have damaged an irreplaceable ecosystem in exchange for a half-functional port. The difference between those two outcomes is not ambition. It is governance,” he adds.

The Great Nicobar Project, work on which is underway, aims to transform the Great Nicobar into a strategic maritime and economic hub by leveraging its proximity to the global East–West shipping route and reducing dependence on foreign transshipment ports keeping in view India’s defence and national security, an official statement said on Friday.

The project, which will strengthen India’s strategic presence in the Andaman Sea and Southeast Asia, seeks to balance port-led economic growth with calibrated environmental safeguards and protection of indigenous communities.

According to the report, the country sits astride the Indian Ocean, commands one of the world’s longest coastlines, and yet for decades has quietly paid Singapore, Colombo, and Port Klang to handle freight that originates on Indian soil.

Approximately three million TEUs of Indian cargo are transshipped annually through foreign hubs, with those three ports alone managing more than 85 percent of that flow.

The lost annual port revenue is estimated at $200–220 million.

“India has, in effect, been a subtenant in its own strategic neighbourhood. The Greater Nicobar project is the first serious attempt to change that — and its ambitions extend well beyond shipping logistics,” the report emphasises.

Notably, a functioning International Container Transshipment Terminal at Great Nicobar would allow India to capture freight revenue currently leaking abroad, reduce feeder voyage times for Indian exporters, and sharpen the competitiveness of Indian trade on the east-west shipping corridor.

Government estimates project annual revenue potential of roughly $3.16 billion by 2040, against a total project outlay of $7.90–8.53 billion.

Moreover, projections of 50,000 jobs should be read as aspirational targets, not guaranteed outcomes — but the macroeconomic logic underpinning the terminal is considerably more robust than a single employment figure.

“India’s Maritime India Vision 2030 and the Sagarmala programme have both identified port-led development as a structural priority; Great Nicobar is where that ambition meets genuine geographic advantage,” says the report.

–IANS

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