Andaman and Nicobar is an Integrated Services Command.
Sitharaman also reviewed the operational readiness of the command.
The exercise, conducted near Campbell Bay, included 10 ships, six aircraft and 700 troops of the Command, a defence ministry statement said.
The Marine Commando (MARCO) unit of the Indian Navy and specialist platoon (GHATAK) of the Indian Army displayed their operational capabilities by carrying out helocasting and beach assault.
While returning from Campbell Bay, Sitharaman visited the southernmost part of India, the Indira Point, the statement added.
The defence minister was given a demonstration on jungle survival skills at Military Station, Birchgunj. Later, she inaugurated the phase II of Married Accommodation Project (MAP) that includes 868 dwelling units for the troops of Andaman Nicobar Command.
“Smt @nsitharaman inspects Joint Amphibious Exercise by Integrated Service Command, ANC off the Campbell Bay coast, the southernmost island of the nation,” the defence minister’s official twitter handle tweeted.
The Andaman and Nicobar archipelago is straddled strategically near the mouth of the Malacca Straits.
The Malacca Straits is an important sea lane of communication and is used by navies of several countries, including China which has been stepping up its military infrastructure in the Indian Ocean region.
This is Sitharaman’s second visit to Port Blair. During her earlier visit in October 2017, she had celebrated Diwali with the troops.