1. The island territories sit at the mouth of the Malacca Straits- which is the second-busiest sea lane of communication (SLOC) in the world i.e. almost 40% of world`s trade, 70-80% energy supplies of China and Japan, more than 21.8 per cent (in excess of $100 billion) of China's exports to the Gulf and Europe pass through the Malacca Straits. Most of the ships approach the straits through the 10 Degree Channel, which bisects the Andaman Islands and the Great Nicobar Islands.This means that by setting up the ANC, India will now have the capacity to protect and monitor sea traffic bound for the South China Sea.It means Cold War Strategy(India) - Malacca Strait is a choke point that could be used to cut off vital supplies in the event of a conflict with China in particular, definitely ANC is intended for that role.
2. Helps New Delhi to check gun-runners, narco-traffickers and pirates. Incidents of piracy in the South China Sea are on the rise and gun-runners use the Andaman Sea to supply arms to insurgents in north-east India via Myanmar and Bangladesh.