What does the cryptic crossword clue "Islands stocking dyestuff for Indian city (7)" mean?

The definition is "Indian city". The wordplay uses a container (one word inside another). HENNA (synonym="HENNA") in CI (synonym="Channel Islands") = CHENNAI; definition: "Indian city" The answer is CHENNAI.

Islands stocking dyestuff for Indian city (7)

Times Cryptic #29017 | 7 Down | 2024-09-09 flower

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