Airborne with a capable team
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In December 2017, when SriLankan Airlines went through the same ‘critical’ process as the national carrier is facing today, a Sunday Times Business Online-cum-Street Poll, on the fate of the airline, revealed that most respondents were not in favour of an outright sale of the struggling, debt-ridden national carrier.This was in contrast to a similar poll conducted (only) online in April 2016 where email respondents, representing largely middle and upper classes of society, were in favour of the government exiting from the airline. So within a year, the tide had changed in favour of the government retaining control of the airline, which it does at the moment. The mixed views in the two polls is possibly because the authorities at the time didn’t adequately explain to the public that the airline was bleeding the state with rolling debt and needed a vital injection of funds from outside sources. Today, there is no doubt the airline needs a fresh infusion of funds which can only come from external investors; otherwise the debt burden will continue unabated.
I was reminded of this during a conversation with know-all neighbour Haramanis of broken English fame. “I shay…..what is happening to ShriLankan Airlines?” he asked during the call on Thursday. “Well the government is still grappling with the process of privatisation,” I said. “There has been talk about the appointment of a new CEO and a chairman. Why (is it) taking so long,” he asked. “Various names are being either discussed or promoted on social media. I don’t think the government has arrived at any decision yet on the appointment of a new chairman and a new CEO,” I said.
On March 30, 2026, SriLankan Airlines Chairman Sarath Ganegoda resigned from the post, with his co-director Rohan Goonetilleke also stepping down. While no reason was given for the two resignations, social media has been buzzing with allegations that the two continued to be directors at the Hayleys Group and their position would conflict with the national carrier as Hayleys is the local agent of British Airways, a competing airline. At the same time Dimal Arandara, Treasury representative on the SriLankan Airlines board, was appointed as Acting Chairman until a permanent appointment is made. The airline is also without a CEO for several months.
The national carrier suffered operating losses in the 2024/25 financial year ending March 2025. During that year, the airline reported a loss of Rs. 2,735 million compared to an operating profit of Rs. 7,925 million in the previous year. Revenue fell by Rs. 36 billion, while exchange gain fell by Rs. 23 billion, according to the accounts available on the airline website. The accumulated loss was Rs. 596,461 million, a debt the government has to bear, unless the authorities are able to find an investor willing to absorb the debt burden.
The government has various options open to revive the airline. In 1998, former President Chandrika Kumaratunga’s administration, sold 40 per cent of the equity of SriLankan, worth US$70 million, and later increased it to 43.6 per cent to Emirates with management control, after it suffered years of losses.
Just as the 10-year arrangement was coming to an end in March 2008 and the foreign partner expected the agreement to be renewed, a clash in which Emirates (also a state-owned carrier) refused to alter a passenger list to accommodate a group connected to then President Mahinda Rajapaksa, resulted in the airline exiting the arrangement. SriLankan Airlines made a profit of Rs. 4.4 billion in 2008, the year in which the management agreement with Emirates Airlines ended. The operations resulted in losses soon after the government regained control of the airline.
Current options available are: Sell the airline outright; sell a 50 per cent or less stake; retain control and only bring in a foreign manager; or run it as it is at the moment as debt mounts.
If one is to look for examples on how struggling national carriers have been resurrected, the fate of Pakistan International Airlines (PIA) may be a good example to follow. Pakistan and Sri Lanka are similar in many ways: wide scale corruption, mismanagement of the economy and mounting debt. Pakistan’s GDP is valued at $407.79 billion and per capita is $1,696. Sri Lanka’s GDP is nearly $100 billion, lower than Pakistan, but its per capita is higher at $5,000 in 2025.
In December 2025, the Pakistan government took a bold decision and sold a 75 per cent stake in PIA for Rs. (Pakistan) 135 billion (nearly $480 million) to the Arif Habib business consortium. It is reported that PIA was losing Rs. 50–100 billion annually. Once among the world’s top airlines, over time political interference, poor governance and mounting debt resulted in the airline being a burden to taxpayers similar to the Sri Lankan case, where the Rs. 500 billion debt must be recovered from the public.
Taking a breather, from another complex column, I walked to the kitchen where a ‘maalu paan’ and a mug of tea were laid out for me. Listening to the conversation of the trio under the margosa tree, I was amazed at their knowledge of current affairs. You would think they were more at home with matters in the kitchen or other mundane stuff. “Mae davas wala aanduwata godak prashna thiyenawa (The government seems to be facing many issues these days),” said Kussi Amma Sera. “Eka-eka wancha siduwemin pavathinawa. Aanduwata athdakeem madida maewa hasuruwaganna (There are all kinds of frauds taking place. Is the government inexperienced to handle these issues)?” asked Serapina. “Cheena jaatheen godak mae lankawey wena wancha walata sambandawela wagey. Aanduwa pravesham wenna oney. Mae kattiyawa ath adanguwata ganna oney (There are many Chinese nationals involved in frauds in Sri Lanka. The government needs to be careful of these people and arrest them),” added Mabel Rasthiyadu.
Talking to an aviation expert, here is his take on how to recover SriLankan Airlines: Consolidation – Consolidate the airline with the current resources: Don’t go for new aircraft – refurbish current ones, provide nice seating, enough leg room and better online entertainment: The Government should exit the airline: Find five or six local buyers – may be offer controlling stakes to Sri Lanka’s biggest conglomerates who can come on board jointly like the Pakistan example; If not have a proper plan: What does the government want from the airline? Run it as a profitable entity and apportion a part of the profit over a period of 5-10 years to tackle debt: Proper management trainee programme to build future leaders who can reach CEO level: and Consolidate current routes and don’t start new ones.
The Pakistan example may be one to follow in deciding the future of the airline. Emirates Airlines is another example where an airline fully owned by the state (UAE government) is churning out profits in billions of dollars due to proper management and little interference by the state. There is no doubt that the country needs a thriving and robust national carrier and selling off the airline – partly or fully – appears to be the only solution. But it has to be done fast, not dilly dally-over previous positions.
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