Archipelago (or island) welcomes navy (6)
I believe the answer is:
orkney
'archipelago' is the definition.
(I know that Orkney is a archipelago)
'or island welcomes navy' is the wordplay.
'island' becomes 'key' (I've seen this in another clue).
'welcomes' means one lot of letters goes inside another (in sense of 'invites in').
'navy' becomes 'N' (common abbreviation eg in RN Royal Navy).
'key' placed around 'n' is 'kney'.
'or'+'kney'='ORKNEY'
(Other definitions for orkney that I've seen before include "Scottish archipelago" , "24 ac archipelago" , "The ...... Islands are off NE Scotland" , "Scottish location" , "Scottish island group" .)