News
Turbulence ahead: Airline on the block in Sri Lanka reforms
By Amal Jayasinghe
Dozens of state-owned Sri Lankan companies employing tens of thousands of people could be restructured or closed as part of an IMF bailout of the bankrupt country, with the country’s airline top of the list for reform.With nearly 6,000 staff, SriLankan Airlines is the biggest and most expensive of the cash-haemorrhaging, sclerotic companies that have drained the budget and compounded the worst financial crisis in national history.
According to treasury figures, the carrier was losing $4.50 for every dollar it earned at the start of this year. It has not turned a profit since 2008, when its chief executive was sacked for offending the country’s then-leader.
“Even those who have never stepped into a Sri Lankan aircraft are paying to subsidise the airline,” government spokesman Manusha Nanayakkara told reporters this month.
“We can’t continue like this.”
Sri Lanka defaulted on its $51 billion foreign debt in April and is now neck-deep in the arduous process of renegotiating its obligations with creditors.Its 22 million people suffered through months of food and fuel shortages, and at the peak of the crisis, a furious mob stormed government buildings and chased Sri Lanka’s former president into exile.
The International Monetary Fund (IMF) has given preliminary approval to a $2.9 billion bailout, and the government hopes to be able to access the first tranche by the end of the year.Terms of the deal have yet to be released, but IMF cash is usually conditional on painful reforms, such as tax hikes, removing consumer subsidies, and privatising or closing underperforming state firms.
The country has more than 300 state enterprises, ranging from nut farms to fuel retailers, and the top 52 firms lost nearly $2.4 billion between January and April — around $140 million a week.
SriLankan Airline’s future is the most urgent priority, and the government last month instructed the finance ministry to begin its restructuring, ideally by attracting outside investment.
But finding a company willing to pour money into the airline will be immensely challenging, analysts say, given its history of interference, mismanagement and turbulent partnerships.In 1998, Emirates bought a minority stake in the carrier and took over its management.
It stayed in the black for most of the next decade, although one of its most profitable years was — ironically — 2001, when the Tamil Tigers separatist movement attacked the country’s main international airport. Several of the airline’s planes were destroyed in the July attack, but insurance payouts and the removal of excess capacity offset a downturn in ticket sales.
But the partnership was terminated and the chief executive sacked by then-president Mahinda Rajapaksa in 2008 after the carrier refused to bump fare-paying passengers to make room for members of his family returning from a jaunt in London. The leader packed SriLankan’s management with relatives and loyalists, several of whom now face corruption charges, and the airline has bled cash since.Rajapaksa even started a rival state-owned airline named after himself, a colossal failure that was eventually merged into SriLankan — along with its accumulated losses.
Authorities tried to sell a 49 percent stake in SriLankan back in 2017 when the island nation’s tourism market was booming, but even then private equity firm TPG eventually withdrew its bid after deciding it was not a viable operation.Airlines are “generally not that attractive” to investors, Singapore-based aviation analyst Brendan Sobie told AFP, “particularly airlines that are government owned and have a lot of legacy issues, have a lot of debt, like SriLankan does”.
“There’s not many foreign airlines, particularly in this post-Covid environment, that are even looking or considering buying stakes in airlines overseas,” he added, and the track record for strategic investments in the sector was “very bad”.
“It’s very difficult,” he said.SriLankan chairman Ashok Pathirage acknowledges the airline’s current balance sheet is not an attractive proposition.
“If you try to privatise the whole thing, people will come and ask the government to take half of the debt,” Pathirage told AFP.
But he said SriLankan could settle about half of its liabilities by splitting off and selling profitable business arms, including its virtual monopoly on catering and ground handling at Colombo airport.Trade union leaders and employees support a restructuring along those lines, on the condition that no jobs are cut.
“The airline is losing money not because of the staff, but expensive leases and poor financial structures,” a cabin crew member, who requested anonymity, told AFP.But selling off the airline’s profitable divisions would leave the rump operations generating even bigger losses for the government.
Former state finance minister Eran Wickramaratne told AFP that if authorities could not find an investor, the airline should be grounded permanently before it could burden the public further.
“We are a bankrupt country,” he said. “We have not been able to service our debt and that reality has struck home.”
News
Gnanasara Thero absconding after SC ruling
Ven. Galagoda Aththe Gnanasara Thero was not at his temple in Rajagiriya when prison officials visited the premises yesterday to take steps following the Supreme Court ruling that nullified the presidential pardon granted to him, police sources said.
Prison officials who visited the temple on Nawala Road, Rajagiriya, were reportedly informed by those present that the Thero’s whereabouts were unknown. The development comes a day after the Supreme Court declared former President Maithripala Sirisena’s 2019 pardon of Gnanasara Thero null and void.
The three-member Supreme Court bench comprising Justices Janak De Silva, Dr. Sobhitha Rajakaruna and Sampath B. Abayakoon held that the pardon was arbitrary, violated the public trust and principles of natural justice, and was made beyond the proper exercise of the President’s constitutional discretion.
The case arose from Gnanasara Thero’s conduct at the Homagama Magistrate’s Court in January 2016 during proceedings relating to the disappearance of journalist and political cartoonist Prageeth Eknaligoda.
The Court of Appeal convicted him on four counts of contempt of court in 2018 and imposed concurrent prison terms amounting to six years. He had served about nine months when Sirisena granted him a presidential pardon on May 23, 2019.
The Supreme Court found that although Article 34 empowers the President to grant pardons, that power is held in trust for the people and is subject to constitutional limitations and judicial review. The Court concluded that Sirisena had effectively acted on the recommendation of the Additional Secretary (Legal) without demonstrating that he had independently considered the relevant material.
Justice De Silva held that the pardon was “arbitrary”, violated public trust and the rules of natural justice, and was ultra vires the President’s powers. The Court consequently found that the decision violated the fundamental right to equality guaranteed by Article 12(1) of the Constitution.
The ruling effectively restores the legal position under the original conviction, leaving Gnanasara Thero without the benefit of the 2019 pardon. The Supreme Court also clarified that a pardon does not erase a conviction or sentence, but merely relieves an offender from serving the sentence to the extent specified in the pardon.
Gnanasara Thero, the General Secretary of the Bodu Bala Sena, had been convicted over his conduct during proceedings concerning the disappearance of Eknaligoda, who went missing in January 2010 and has not been located.
Sandhya Eknaligoda, Prageeth Eknaligoda’s wife, was among those who challenged the presidential pardon before the Supreme Court, alongside the Centre for Policy Alternatives and its Executive Director Dr. Paikiasothy Saravanamuttu.
The detailed account of the judgment indicates that the Court’s ruling primarily nullified the pardon and restored the legal effect of the original sentence, with the implementation of the sentence falling to the relevant authorities.
Police sources said that the Supreme Court, however, did not permanently close the door on executive clemency. It held that a future President could grant Gnanasara Thero another pardon, provided the power is exercised lawfully and after proper consideration of all relevant material.
The Supreme Court has so far overturned three presidential pardons granted to two former Presidents. In January 2024, the Court declared former President Gotabaya Rajapaksa’s pardon of former MP Duminda Silva unlawful and invalid. In June 2024, it invalidated two pardons granted by former President Maithripala Sirisena to Royal Park murder convict Jude Shramantha Anthony Jayamaha — the first in May 2016, which commuted his death sentence to life imprisonment, and the second in October 2019, which released him from prison. Jayamaha, who was convicted of the murder of 19-year-old Yvonne Johnson, remains at large. Most recently, on September 10, 2026, the Supreme Court declared Sirisena’s 2019 pardon of Ven. Galagoda Aththe Gnanasara Thero null and void, ruling that it was arbitrary and inconsistent with the Constitution.
News
House to debate 22A, Judicature Bill next week
Parliament is scheduled to debate the Twenty-Second Amendment to the Constitution Bill and the Judicature (Amendment) Bill on September 24 and 25, subject to the Speaker’s announcement following the delivery of the Supreme Court determination on petitions filed against the Bills.
The programme for the Parliamentary Week from September 22 to 25 was decided at a meeting of the Committee on Parliamentary Business held on Thursday (10) under the chairmanship of Speaker Dr. Jagath Wickramaratne.
On each sitting day, Parliamentary Business under Standing Orders 22(1) to 22(6) will be taken up from 9.30 am to 10 am, followed by Questions for Oral Answers from 10 am to 11 am Questions under Standing Order 27(2) will be taken up from 11 am to 11.30 am.
On Tuesday (22), the Orders published in Extraordinary Gazette No. 2497/37 under the Petroleum Resources Act and the Promotion of Export Agriculture (Amendment) Bill will be debated from 11.30 am to 5 pm.
The Tredso Development Foundation (Incorporation) Bill, a Private Member’s Bill, will then be taken up for Second Reading before being referred to the Legislative Standing Committee.
An Opposition motion at the Adjournment Time will follow.
On Wednesday (23), the Chartered Institute of Media Professionals of Sri Lanka Bill will be debated from 11.30 am to 5 pm, followed by Questions at the Adjournment Time.
The Second Reading debate on the 22nd Amendment Bill and the Judicature (Amendment) Bill is scheduled for 11.30 am to 7 pm on Thursday (24) and Friday (25).
News
Wrong house targeted in underworld grenade attack: Two children killed
Two children aged 11 and 17 were mistakenly killed and their 55-year-old father injured in an early morning hand grenade attack on Sirisangabo Mawatha on Friday. Police investigations later revealed that the attackers targeted the wrong house during an ongoing underworld clash.
Three police teams have been deployed to investigate the attack, which occurred at around 3 am.
According to police, a man who arrived near the house in a three-wheeler knocked on the front door before throwing a grenade into the premises and fleeing.
The victims were identified as 17-year-old Kasun Rashmika and 11-year-old Duminda Gihan. Their 56-year-old father, Nalin Thusantha Perera, was seriously injured and admitted to the Kalubowila Teaching Hospital.
Police said the injured man’s brother was allegedly a close associate of a drug trafficker known as ‘Sando’ and had also been accused of involvement in drug trafficking.
The brother lives in a house adjoining the one targeted in the attack, and police suspect the grenade may have been thrown at the wrong house.
Police are also investigating information that the attack was allegedly carried out at the direction of several overseas-based drug traffickers, identified as Pandithage Shantha Kumara alias ‘Kos Malli’, Samantha Perera alias ‘Chuwa Samantha’, ‘Kudu Avishka’ and ‘I.D.’
Police said the attack was believed to be linked to an ongoing conflict between two underworld factions, which have targeted each other’s associates in shootings and grenade attacks. More than 20 people have reportedly been killed in such attacks.
Security agencies are also investigating alleged links between one faction and overseas-based criminals including Kanjipani Imran, Unakuruwe Shantha, Dubai Gagana and Handaya.
Security agencies have also received information that overseas-based criminals identified as Kanjipani Imran, Unakuruwe Shantha, Dubai Gagana and Handaya are allegedly behind the supply of firearms and drugs to the faction associated with Kos Malli and Chuwa Samantha.
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