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Thursday, June 8, 2023

Pathirage says no discussions yet on SriLankan privatisation – The Morning

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  • Claims however he has a plan on how to privatise 
  • Adds SriLankan doesn’t have to follow Air India privatisation 


By Imesh Ranasinghe

No discussions have officially started yet on privatisation of the national carrier SriLankan Airlines, however, SriLankan has a plan on how the privatisation should be carried out if the Government is to go ahead, stated SriLankan Airlines Chairman Ashok Pathirage. 

Speaking to The Morning Business, he said that Prime Minister Ranil Wickremesinghe, in his national address on Monday (16), had said what was best for the country and announced what he wanted to be done. 

“If there is a privatisation, we have to follow the right model. It doesn’t have to be the same as the Air India takeover by TATA,” Pathirage said, adding that SriLankan has different businesses such as ground handling, catering, and the airline itself. 

“We also have done a plan on how to privatise,” he noted. 

In his address to the nation on Monday, Prime Minister Wickremesinghe had said that he proposes to privatise the loss-making SriLankan Airlines, and said that in the 2020/21 financial year alone, it had incurred a loss of Rs. 45 billion. 

Further, he had said by 31 March 2021, its total losses were Rs. 372 billion. 

“Even if we privatise it we have to bear the loss,” he had said. “You should note that this loss has to be borne by the poorest of the poor who have not set foot in an aircraft.” 

In a statement earlier this month, the airline said that it had accumulated an unsustainable debt of $ 878 million, the majority of which is owed to state banks, the Ceylon Petroleum Corporation (CPC), and government-guaranteed dollar bonds. 

Accordingly, the debt under government-guaranteed dollar bonds is $ 175 million, which was reissued in 2019. 

Last year, the Committee on Public Enterprises (COPE) came up with four alternatives for SriLankan Airlines as follows: 

  • To carry on operations as usual with a very productive, proactive, and viable profitable business plan;
  • Lose and restart as a new mechanism through which SriLankan can get rid of some burdens; 
  • Go for a separate airline industry by completely closing down the present one, and starting three different companies – each for the airline, for catering, and for ground handling; or 
  • Completely close the airline industry down as a government entity.

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