Connect with us

News

Significant contraction in profitability of SOE sector in first half of 2025

Published

on

Eighteen out of 52 major state-owned enterprises (SOEs) have incurred losses in the first six months of 2025, worsening fiscal pressures on the government and taxpayers, according to the Mid-Year Fiscal Report released by the Ministry of Finance.

The report has revealed a significant contraction in the profitability of the SOE sector. During the first half of 2024, the 52 entities collectively posted profits of Rs. 280.7 billion. In contrast, their combined profit for the corresponding period in 2025 has dropped to Rs. 227.8 billion—a decline of more than Rs. 52 billion.

Among the largest loss-makers are the Ceylon Electricity Board (CEB), SriLankan Airlines and the Lanka Sugar Company, all of which have recorded steep reversals compared to previous years. The CEB has posted a pre-tax loss of Rs. 13.2 billion as at 30 June 2025, a dramatic fall from profits of Rs. 144 billion in 2024 and Rs. 57.6 billion in 2023.

SriLankan Airlines has also suffered a sharp downturn, recording a pre-tax loss of Rs. 12 billion between April and June alone. The airline’s cumulative losses now stand at a staggering Rs. 628 billion. Its equity position has deteriorated to a negative Rs. 415 billion, while total liabilities have risen to Rs. 606.7 billion.

A BBC report cited by the Finance Ministry attributes the airline’s continuing losses to inadequate revenue diversification and heavy debt-servicing obligations.

The Cabinet has already approved restructuring of long-overdue debt amounting to USD 210 million and Rs. 31.4 billion, to be serviced with Treasury involvement.

Meanwhile, Lanka Sugar Company Limited has recorded a pre-tax loss of Rs. 2.6 billion as at 30 June, compared to a loss of Rs. 1.9 billion in 2024 and a profit of Rs. 2.8 billion in 2023, reflecting further deterioration in performance.

Presenting the 2026 Budget, President Anura Kumara Dissanayake said political interference, weak financial discipline and patronage-based recruitment had turned several state entities into “a heavy burden on the economy.” He noted that a number of institutions had failed to pay bank loans, taxes or employee EPF/ETF contributions. The government has already allocated Rs. 11 billion to settle overdue employee benefits and outstanding taxes.

The President said the government would shut down institutions with no commercial, regulatory or administrative value, merge agencies performing overlapping functions and reorganise those that have diverged from their core mandates.

SOEs currently in the red include the CEB, SriLankan Airlines, Lanka Sugar Company, State Engineering Corporation, Lanka Sathosa, Hotel Developers (Lanka) Ltd, State Development and Construction Corporation, Sri Lanka Rupavahini Corporation, State Timber Corporation, ITN, SLBC, State Printing Corporation, Ceylon Fisheries Harbour Corporation, National Livestock Development Board, Janatha Estate Development Board, Sri Lanka State Plantation Corporation, Sri Lanka Cashew Corporation and the Ceylon Fisheries Corporation.

A number of institutions—among them Lanka Sugar Pvt Ltd, the Janatha Estate Development Board, SLSPC, SLRC, Ceylon Fisheries Corporation, NLDB, Elkaduwa Plantations Ltd, SLBC, North Sea Ltd and Lanka Ceramics JV Corporation—have been unable to meet EPF/ETF and tax obligations and now require direct Treasury support.

Despite the pressures, the Finance Ministry notes that several major SOEs have posted stronger results. State banks have reported a combined profitability increase of Rs. 65.5 billion in the first half of the year, while the Sri Lanka Ports Authority, National Water Supply and Drainage Board and Employees’ Trust Fund Board have also improved their performance.

The government has already begun the process of closing 33 inactive institutions by 2026 and restructuring others in line with new efficiency and governance targets.



Latest News

70,297 persons still in safety centers

Published

on

By

The Situation Report issued by the Disaster Management Center at 06:00AM on 16th December 2025 shows that 70,297 persons belonging to 22,338 house holds are still being housed at 731 safety centers established by the government.

The number of deaths due to the recent disastrous weather  stands at 643 while 183 persons are missing.

Continue Reading

News

MEPA to crack down on marine polluters

Published

on

… Warns would-be polluters of criminal prosecution, hefty fines and even blacklisting

The Marine Environment Protection Authority (MEPA) has warned that ship owners, operators and local entities responsible for marine pollution will face criminal prosecution, heavy financial penalties and possible blacklisting, MEPA Chairman Samantha Gunasekera said yesterday.

Gunasekera told The Island that Sri Lanka would no longer tolerate negligence and regulatory breaches that threaten the country’s marine ecosystems, coastal livelihoods and national economy.

“Any party that pollutes our seas—whether foreign vessels or local operators—should be prepared to face the full force of the law,” Gunasekera said. “There will be no room for excuses, delays or backdoor negotiations when marine pollution is involved.”

He said MEPA has intensified surveillance of major shipping routes, ports and environmentally sensitive zones amid rising maritime traffic through Sri Lankan waters, which remain among the busiest in the Indian Ocean.

by Ifham Nizam

Continue Reading

News

SC delegation, headed by CJ Surasena, observes Indian Supreme Court in action

Published

on

A 10-member delegation from Sri Lanka’s Supreme Court, headed by Chief Justice P. Padman Surasena, with Indian judicial officials

A 10-member delegation from Sri Lanka’s Supreme Court, headed by Chief Justice P. Padman Surasena, departed to New Delhi on the 11th of December, 2025, for an official visit to the Supreme Court of India as part of the ongoing official visit by the delegation to India.

The group was accorded a ceremonial welcome in the Court’s main hall, led by the Chief Justice of India (CJI) Surya Kant. CJI Kant told the assembled Judges that “the Indian judiciary was honoured to host” their Sri Lankan counterparts, expressing hope that the visit would be “meaningful and very constructive” and underscoring the “close emotional bonds” between the two countries.

The focal point of the programme was a special sitting of the Supreme Court. Chief Justice Surasena joined CJI Kant and Justice Joymalya Bagchi on the bench, presiding over the Court as a guest Justice. He was accompanied by nine other Supreme Court justices from Sri Lanka, who took seats in the well of CJI Kant’s courtroom to observe the day’s proceedings.

Supreme Court Bar Association President Vikas Singh formally greeted the delegation and praised Justice Surasena’s reformist efforts. Singh recalled the Sri Lankan Chief Justice’s own maxim, “If you want something you have never had, then you have got to do something you have never done”, highlighting the bold changes Surasena had introduced to modernise Sri Lanka’s Court system. Singh noted that these initiatives, particularly court digitization, were aimed at eradicating “the persisting problems of law delays” and streamlining case backlogs.

The Sri Lankan Judges spent the morning observing live Supreme Court proceedings in CJI Kant’s courtroom. This first-hand exposure to Indian court operations formed a key part of the programme’s judicial engagement. During the hour-long session, the visiting justices witnessed a range of cases on the Supreme Court’s roster, with Justice Surasena and the delegation following arguments from the front. The experience was designed to be immersive and following the hearing the Sri Lankan Judges were briefed on India’s own initiatives towards a digitalised court system, e-filing and case management systems.

The official programme then shifted to capacity-building and information exchange. In the early afternoon, Indian Supreme Court officials gave the Sri Lankan delegation detailed briefings on India’s technological initiatives. Court registrars demonstrated the e-filing system and other e-initiatives implemented by the Supreme Court of India. Additional presentations outlined the Court’s new case management systems and administrative reforms. These sessions highlighted how digital tools and better case-listing procedures have been used in India to increase efficiency. The Sri Lankan judges asked questions about India’s experience with electronic court records and the integration of technology in daily judicial work, reflecting their own interest in similar reforms back home.

The visit underscored the growing collaboration between the Indian and Sri Lankan judiciaries. Throughout the proceedings, both sides emphasised their shared legal traditions and mutual respect. As Chief Justice Surasena noted during the sitting, India is Sri Lanka’s “closest neighbour,” and historic links, even dating back to ancient epics, form the backdrop for today’s judicial dialogue. CJI Kant remarked that having the chief justices of two vibrant democracies together on the bench was a “significant moment” for the rule of law.

The Sri Lankan delegation continued its programme in Delhi on 12 December with a visit to the Delhi High Court and its International Arbitration and Mediation Centres. The exchange visit is expected to deepen judicial cooperation and provide practical insights for both courts. Officials on both sides say the engagement aimed at sharing best practices in court administration, reinforce legal ties and support ongoing reforms aimed at reducing case backlogs and delays.

Continue Reading

Trending