Union territory39 researched factorsअंडमान और निकोबार द्वीपसमूह

Starting a small business in Andaman & Nicobar Islands (2026): costs, wages, rent, licences

Andaman & Nicobar Islands at a glance

Everything is shipped from Chennai, Kolkata or Visakhapatnam, so landed costs for stock, milk, LPG and building materials are higher than the mainland, and sailings decide what is on shelves; outer islands have run out of onions, eggs and milk when ships were missed. Yet fuel VAT is very low (diesel about ₹84.56/L), and wage floors are high (₹652–660/day unskilled, revised every six months), so labour costs more than on the mainland. Demand is a mix of a government-employee base and tourism concentrated in Oct–May, especially Havelock and Neil. Power is diesel-generated at ₹22–28/unit and heavily subsidised. Monsoon sea closures, cyclones and earthquakes are the place-specific risks.

MetroSri Vijaya Puram (Port Blair)

Mid-size citySwaraj Dweep (Havelock)

Small townDiglipur

Business ideas in Andaman & Nicobar Islands

Andaman & Nicobar Islands at a glance

Cities used for the three sizes: Sri Vijaya Puram (Port Blair) · Swaraj Dweep (Havelock) · Diglipur

	Here	India	vs India
Minimum wage, monthly	₹17,160	₹12,500	+37%
Unskilled day wage	₹700Estimate	₹500	+40%
Shop rent, metro (per sq ft/month)	₹90Estimate	₹150	−40%
Shop rent, mid-size city	₹80Estimate	₹60	+33%
Shop rent, small town	₹25Estimate	₹25	≈
Commercial power, per kWh	₹10Estimate	₹9.5	+5%
Commercial LPG cylinder	₹3,300Estimate	₹2,810	+17%
Petrol, per litre	₹89Estimate	₹102	−13%
Cup of tea / coffee	₹15Estimate	₹12	+25%
Simple meal	₹120Estimate	₹80	+50%
Men's haircut	₹120Estimate	₹100	+20%
Milk, 1 litre	₹70Estimate	₹60	+17%
Bread loaf	₹50	₹45	+11%

Taxes

Sales Tax	GST 5/18% (national)
Small Biz Threshold	₹40 lakh goods / ₹20 lakh services (national)
Local Levies	No professional tax (Est.); municipal trade licence in Sri Vijaya Puram; tribal-reserve and forest restrictions

Licences and registrations

Rules vary by state and city: confirm with your municipal office.

Licences and registrations	Fee	Authority	Source
Shop & Establishment registration (A&N Shops & Establishments Regulation)	Nominal (not retrieved)	Labour Department, A&N Administration	Est.: fee not found
Trade licence (Port Blair Municipal Council / panchayat)	By trade (not retrieved)	PBMC / PRI	Est.: fee not found
Tourism trade / homestay registration	Required for guesthouses, tour operators, water sports (fee not retrieved)	Directorate of Tourism	Est.

Festivals and demand

Festivals and demand	Dates (2026–27)	Effect on trade
Deepavali	about 8 Nov 2026	Sweets, clothes; supply must be shipped in weeks ahead
Christmas / New Year	25 Dec 2026 – 1 Jan 2027	Peak tourist arrivals; Havelock/Neil hotels and eateries full
Island Tourism Festival	about Jan 2027	10-day fair at Sri Vijaya Puram; food stalls, crafts
Subhas Chandra Bose Jayanti / Parakram Diwas	23 Jan 2027	Netaji-linked events; Ross (Netaji Subhas Chandra Bose) Island visitors
Eid al-Fitr	about 10 Mar 2027	Local Muslim community demand
Durga Puja	about 4–8 Oct 2027	Large Bengali settler population; pandals, sweets, clothes

Seasons and weather

Oct–May · Tourist season; calm seas, ferries and flights full; Dec–Jan peak
May–Sep · South-west monsoon: rough seas cancel inter-island ferries and cargo; tourist trade −50–70%
Oct–Dec · Cyclone risk in the Bay of Bengal; ship cancellations

How people pay

DigitalShare · about 50–70% UPI in Sri Vijaya Puram; patchy connectivity in outer islands keeps cash dominant (Est.)
Credit · udhaar common among settlers; tourists pay UPI/card

39 researched factors

JSON · Source · Estimate

39 researched factors
Factor	Typical value in India	Source
Minimum wage, unskilled (all schedules incl. shops/hotels)	₹660/day from 1 Jul 2026 (₹652 from 1 Jan 2026)	nicobartimes.com
Minimum wage, other skill levels (Jan 2026)	Semi-skilled ₹733 (₹741 from Jul), skilled/clerical ₹856, highly skilled ₹939 per day	andamansheekha.com
Monthly equivalent used in basket	₹17,160 (₹660 × 26)Estimate	Est.: computed from P01
VDA revision cadence	Every 1 Jan and 1 Jul under the Code on Wages	nicobartimes.com
Casual day wage (market)	₹700/day; tourism-season labour scarceEstimate	Est.: legal floor ₹660 plus premium
Mainland migrant staff	Shops/hotels hire from Bengal, Tamil Nadu, Kerala; travel and lodging add ~₹2k–4k/month per workerEstimate	Est.
Shop rent T1 Sri Vijaya Puram (Aberdeen Bazaar)	₹90/sq ft/monthEstimate	Est.: scarce commercial space in a ~1.…
Shop rent T2 Swaraj Dweep (Havelock)	₹80/sq ft/month (tourism premium)Estimate	Est.
Shop rent T3 Diglipur / Rangat	₹25/sq ft/monthEstimate	Est.
Commercial electricity	≈₹10/kWh effective (FY24: ₹9.25 for 0–200 units, ₹16.50 above 1,000; revised order from 1 Nov 2025 not retrieved)Estimate	nicobartimes.com
True generation cost	₹22–28 per unit (diesel-based); tariff heavily subsidised	nicobartimes.com
Diesel, Sri Vijaya Puram	₹84.56/L (7–16 Oct 2026)	aajtak.in
Petrol	≈₹89/L (lowest VAT in India)Estimate	Est.: diesel ₹84.56 + historical petro…
Commercial LPG 19 kg	≈₹3,300Estimate	Est.: Kolkata ₹2,954 / Chennai ₹2,983 …
Power cuts	Scheduled/unscheduled outages common, especially outer islands; gensets needed for cold storageEstimate	Est.: diesel-grid fragility
Shipping-dependent stock	Outer islands wait 30–45 days for cargo; markets ran out of onions, eggs, tetra milk (Great Nicobar, 2023)	nicobartimes.com
Transhipment cost	Indirect cargo routing adds ~₹250 per package (Katchal via Kamorta, 2023)	nicobartimes.com
Landed-cost uplift on mainland goods	+10–25% vs Chennai/Kolkata wholesaleEstimate	Est.: freight + handling + spoilage
S&E and trade licence	Nominal fees; PBMC licence in the capitalEstimate	Est.
Restricted areas	Tribal reserves (Jarawa, Nicobar) and restricted islands bar non-locals from trading; land purchase limited for outsidersEstimate	Est.: ANPATR regulation
Professional tax	None levied (Est.)Estimate	Est.: no A&N PT act known
GST and FSSAI	National rules unchanged	fssai.gov.in
Tourist season	Oct–May; Dec–Jan peak; Havelock eatery demand 2–3× vs monsoonEstimate	Est.
Island Tourism Festival	About Jan 2027, ~10 daysEstimate	Est.
Durga Puja / Deepavali	Bengali settler festival Oct; Deepavali ~8 Nov 2026Estimate	Est.
Monsoon sea closure	May–Sep; inter-island ferries cancelled on rough days; tourist trade −50–70%Estimate	Est.
Cyclone	Oct–Dec and May; ships/flights cancelled 2–5 daysEstimate	Est.
Earthquake / tsunami	High seismic zone (2004 tsunami); rare but catastrophicEstimate	Est.: very low annual probability
Packet / UHT milk	≈₹70/L (limited local dairy; UHT shipped)Estimate	Est.
Tea, T2	₹15Estimate	Est.
Simple meal (fish thali), T2	₹120 (tourist restaurants ₹250+)Estimate	Est.
Men's haircut	₹120Estimate	Est.
Per-capita income	PPP ≈$16,066 (2025-26), ~16th nationally	en.wikipedia.org
Population and urbanisation	~4 lakh people; ~38% urban, concentrated in Sri Vijaya Puram (Census 2011)Estimate	Est.: Census 2011 (old)
Government-salary demand base	Large share of households on government/defence pay; steady month-start demandEstimate	Est.
Digital share	Capital 50–70% UPI; outer islands cash-heavy due to network gapsEstimate	Est.
Languages	Hindi lingua franca; Bengali, Tamil, Telugu, Malayalam settler communitiesEstimate	Est.
Ferry or dinghy ban	Administrative bans on small cargo boats have caused fuel/essentials shortages on Havelock	andamansheekha.com
FX used for USD conversion	₹94 per USD (Est.)Estimate	thewire.in