SriLankan Airlines set for PPP push and new heads, says Minister
EconomyNext: Sri Lanka is moving to transition its loss-making national carrier, SriLankan Airlines, into a public-private partnership (PPP) venture within the year, after attempts to run it under full state ownership proved unsustainable, a minister said.
Minister of Ports, Civil Aviation and Energy, Anura Karunathilaka, said the government has tasked an institution with drawing up investment proposals to call for private partners.
The airline, long flagged as a major fiscal burden, is currently absorbing 90 billion rupees in public funds at a rate of Rs. 30 billion annually until 2030, he said, alongside previous debts absorbed by the Treasury.
According to the minister, the airline has requested an additional Rs. 10 billion to sustain its current operations.
“This is genuinely not something that can be sustained indefinitely,” Karunathilaka said during an interview on private media channel Swarnavahini.
“It is unjust because, individuals who have never even seen an aircraft — let alone travelled on a flight — are forced to contribute to this through their taxes,” Karunathilaka said.
Defending the decision against a complete privatisation, Karunathilaka noted that the government plans to retain an equity stake to ensure the airline can be deployed during national emergencies.
He cited past operations, such as evacuating stranded Lankan students from China during the Covid-19 pandemic, as reasons for maintaining a state claim.
“Our expectation is to retain that portion as the state’s equity investment, secure private investment for the remainder, and operate it under a public-private partnership framework,” he explained.
Addressing criticism regarding severe governance delays — including the airline currently operating without a chairman or executive director — the minister promised rapid appointments.
The interview process for a new chief executive officer is currently underway, and a suitable name has already been proposed for the role of chairman.
“An exceptionally good proposal has been received now, and within a week or two, you will be able to witness a competent chairman appointed to SriLankan Airlines,” Karunathilaka said.
OSL take:
Sri Lanka’s ongoing state sector reform programme is creating new business/investment opportunities for foreign businesses/investors seeking to participate in the country’s economic transformation. The proposed transition of the national carrier, SriLankan Airlines, into a PPP reflects the Sri Lankan government’s commitment to enhancing efficiency, attracting investment, and leveraging private sector expertise in strategic state-owned enterprises. As Sri Lanka continues to strengthen its economic outlook and position itself as a regional business hub, reforms involving state assets are expected to generate business/investment opportunities across aviation, logistics, tourism, infrastructure, and related service sectors. Foreign businesses/investors can contribute capital, technology, management expertise, and operational efficiencies while gaining access to a strategically located market at the crossroads of major international trade and travel routes. The broader state sector reform agenda signals a shift towards greater private sector participation and investment-friendly policies, offering international businesses/investors the opportunity to become partners in modernising key industries and supporting Sri Lanka’s long-term growth and competitiveness.
| Article Code : | VBS/AT/20260608Z_3 |