The economy of Ooty is mainly dominated by Tourism, however, much of its local revenue is also generated from being the nodal supply base and market town for its surrounding regions who largely dependent on agriculture as their source of income.
Agriculture in Ooty mainly delves on the cultivation of English Vegetables such as potatoes, cabbages, carrots and cauliflower and English Fruits such as peaches, pears, plums and strawberries that are retailed in a daily wholesale auction organised by the Ooty Municipal Market.
The other major source of Ooty economy comes from Dairy farming wherein a cooperative dairy manufactures skimmed milk powder and cheese on a large scale and are distributed within India and exported to other countries as well.
Ooty also homes several research Institutes owing to its local agricultural industry such as a livestock farm, soil conservation center and potato research farm. These institutes take efforts to diversify the range of local crops grown in Ooty and its neighbouring areas through the cultivation of mushrooms and introduction of other methods such as Floriculture and Sericulture.
Floriculture, a discipline of horticulture also known as flower farming, relies on the cultivation of ornamental plants and flowering for floristry and gardens including breeding and development of new varieties of plants while Sericulture, also known as silk farming, involves rearing of silkworms for raw silk production thus assisting in improving the revenue generated for Ooty.
Ooty economy is also supported by the revenue generated from the Hindustan Photo Films unit, an old photo film manufacturer known to be a major industry situated in a town called Indu Nagar on the outskirts of Ooty. Another institute present in Ooty is the Human Biologicals Institute responsible for manufacturing Human Rabies Vaccine.
There are several other important manufacturing industries situated on the outskirts of Ooty such as in Coonoor where rabies vaccine is manufactured too. Though the economy of Coonoor is primarily dominated by tourism during the summer seasons, it is mainly dependent on its tea industry all year round. Another town near Ooty is Ketti, where the Needle Industries Pvt. India Ltd. is situated responsible for the manufacture of international brand Pony Needles.
Aruvankadu, which means ‘Forest of Snakes’, is another small town situated on the National Highway 67 between Coonoor, at a distance of 5 kms and Ooty, at a distance of 12 kms respectively. This village is home to the Cordite Factory that was established by the British Government in 1903 and is based on a huge campus area responsible for the manufacture of arms and ammunitions and Cordite or Gun powder also used as a propellant agent in various armed tanks. This Factory is also considered as one of the oldest Defence Factories that falls under the Indian Ordnance Factories and the Ministry of Defence, Government of India.
Ooty economy is also supported by its Carpentry industry, Cottage industries and factories that make pickles and chocolates. Homemade chocolates are also very popular amongst the locals and tourists in Ooty and is a must try.
Though the economy of Ooty is also supported by its tea industry, it does not grow or process tea. In fact, Tea is produced at slightly lower altitudes like Coonoor and Kotagiri that are known as local centres of cultivating tea and processing it for Ooty.