• Civil Aviation Minister says operational revenue to be utilised for legacy debt servicing 
• Notes that national carrier is at present operationally profitable

Deputy Civil Aviation Minister Janith Ruwan Kodithuwakku said yesterday (19) that the Government will continue to operate SriLankan Airlines under State control, stating that retaining ownership enables revenue from the airline’s operations to be used to service long-standing debt obligations.

Speaking to The Daily Morning on the future of the Airline, the minister said SriLankan is presently functioning as an operationally profitable entity, though its overall financial position continues to reflect losses due to historical borrowings accumulated over many years. He explained that the Airline recorded an operational profit as recently as January, indicating that its day-to-day aviation operations are generating income. 

"The losses reflected in financial statements are largely the result of legacy debt repayments rather than weaknesses in current operations. Each time loan installments linked to past borrowing are settled, the accounting position shows a loss despite operational earnings."

He further noted the Government has already initiated a restructuring programme aimed at managing these liabilities. "The Government will still be responsible for repaying the Airline’s debt even if SriLankan Airlines is to be sold or transferred to another party. In such a situation, the Government would lose the income generated by Airline operations but remain liable for debt servicing." Kodithuwakku added that retaining the Airline enables the Government to continue earning revenue that contributes, at least partially, towards settling outstanding financial obligations. Selling the Airline under the current conditions, he said, would require the Government to assume and repay existing debt without receiving any operational income in return. "For that reason, we will continue to operate SriLankan Airlines under the Government's control."

SriLankan Airlines, operates passenger and cargo services connecting Sri Lanka with destinations across Asia, Europe, the Middle East, and Australia. The Airline has long been viewed as strategically important for tourism promotion, trade connectivity, and maintaining direct international air links, particularly during periods of economic recovery. Despite its operational significance, the Airline has faced persistent financial challenges for a few decades. Successive Governments have explored restructuring plans, strategic partnerships, and privatisation proposals as mounting debt and accumulated losses placed pressure on public finances.