Industrial Development & Economic Growth in

Lakshadweep
ibef.org/states/lakshadweep

LAKSHADWEEP STATE REPORT

Sep, 2022

INTRODUCTION

Lakshadweep is India’s smallest union territory (with a total area of 32 sq. km.) consisting
of 36 islands. The state has 12 atolls, three reefs, five submerged banks and ten
inhabited islands. The geographical location of Lakshadweep provides the Indian Navy
with great outreach around the western Indian Ocean for patrolling and surveillance.
Consequently, it can be used to boost the power projection capabilities of the Navy.

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The abundance of Lakshadweep Islands has provided India with 20,000 sq. km. of
territorial waters and 400,000 sq. km. of Economic Zone Exclusive (EEZ). There are
valuable fisheries and mineral resources in the lagoons, and the EEZ around the
Lakshadweep Islands are of enormous economic significance.

In 2020, the government announced optical fibre cable (OFC) connectivity in

Lakshadweep. In October 2021, the submarine optical fibre cable (OFC) project was
awarded to Japanese conglomerate NEC’s Indian subsidiary. By 2023-24, the Rs. 1,072
crore (US$ 140.11 million) submarine OFC project is expected to be completed, which will
improve online education and e-medicine, and allow local people new opportunities in the
field of education, employment and business.

In FY22, the exports from Lakshadweep stood at US$ 160,000.

As of August 2022, Lakshadweep had a total installed power generation capacity of 3.27
MW, which was generated by private utilities. In the Budget 2022-23, the power sector of
Lakshadweep was allocated Rs. 125.56 crore (US$ 16.42 million). The National Institute
of Ocean Technology (NIOT), an independent institute under the Ministry of Earth
Sciences (MoES), is building an Ocean Thermal Energy Conversion (OTEC) plant with a
65kW capacity in Kavaratti, Lakshadweep. This plant will supply energy to a 1 lakh litre
per day desalination facility that uses Low Temperature Thermal Desalination (LTTD) to
turn seawater into potable water.

In April 2022, the Lakshadweep Administration declared the Wednesday of every week as
a 'Cycle Day' for government employees, which will help curb pollution and decrease the
carbon footprint of the union territory.

RECENT DEVELOPMENTS IN KEY SECTORS

In Lakshadweep, the estimated potential of marine fishery resources is about one lakh
tonnes of tuna.

In September 2021, large-scale farming of indigenous seaweeds was launched in

nine inhabited islands of Lakshadweep under the guidance of Central Marine
Fisheries Research Institute (CMRI). The plan is to produce 30,000 tonnes in a
year, which will be worth Rs. 75 lakh (US$ 98,120).
In June 2021, Lakshadweep started exporting tuna to Japan, via Bengaluru.

In Lakshadweep, tourism is one of the few areas that can play a vital role in generating
revenue, jobs and overall island growth.

In the Budget 2022-23, Lakshadweep was allocated Rs. 9.5 crore (US$ 1.24 million)
for tourism development in the union territory.

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 In August 2021, the Lakshadweep administration invited global tenders for building
eco-tourism beach villas and water villas in the Kadamat, Minicoy, and Suheli
islands at an estimated project cost of Rs. 813 crore (US$ 106.36 million).
According to NITI Aayog, which has requested consultant bids, the Lakshadweep
administration intends to create eco-tourism projects in public-private partnerships
on 11 islands.
In February 2021, the UT, in its proposal to the Ministry of Home Affairs, announced
its plans to dedicate a tourist ship in the islands with the aim of developing cruise
tourism and generate employment opportunities.
In January 2021, the Ministry of Ports, Shipping and Waterways (MoPSW) began
operations of seaplane services on select routes under a special purpose vehicle
(SPV) framework, through prospective airline operators. The proposed origin-
destination pairs include Lakshadweep and the Andaman & Nicobar Islands. The
project execution and implementation would be through Sagarmala Development
Company Ltd. (SDCL), which is under the administrative control of the ministry.

In the Budget 2022-23, agriculture and allied activities were allocated Rs. 19.41 crore
(US$ 2.54 million).

In February 2021, Lakshadweep and the National Co-operative Development

Corporation (NCDC), an apex finance entity under the Union Agriculture Ministry,
signed a pact to ensure all-round development of farmers and fishermen. This will
help scale up farming operations of the farmers and fishermen for better access to
quality input, technology, credit and market through economies of scale.
In December 2020, the Ministry of Agriculture declared Lakshadweep as India’s first
UT to cultivate 100% organic produce.

In July 2021, the Ayushman Bharat Pradhan Mantri Jan Arogya Yojana (PM-JAY) was
launched in Lakshadweep, which will help 12,320 beneficiary families. The scheme will
give an annual healthcare benefit of up to Rs. 5 lakh (US$ 6,541) for every eligible family.

LAKSHADWEEP STATE REPORT

Sep, 2022

FACTFILE

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Capital

Kavaratti

Geographical Area (sq km)

32

State Language

Malayalam, Mahl, Bengali, Oriya, Tamil, Urdu and Hindi

Literacy Rate

92.28 per cent

Administrative Districts

Key Industries:

Fishery

Agriculture

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Tourism

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