India urges quick use by Sri Lanka of religious and cultural grant

ECONOMYNEXT – Sri Lanka’s cabinet of ministers had asked a newly set up state owned enterprise re-structuring unit to come up with recommendation on how to re-structure state-run SriLankan Airlines and its subsidiaries.

Sri Lanka’s Aviation Minister Nimal Siripala de Silva had earlier suggested that SriLankan Catering and its ground handling units – the most profitable units – be sold separately to investors.

De Silva said at the time that cabinet approval would be sought for the move.

However at this week the cabinet had given “the responsibility of studying the methodology of restructuring Sri Lankan Airlines Company Limited and making recommendations to the Cabinet of Ministers to State – owned Enterprises Restructuring Unit established under the Ministry of Finance, Economic Stabilization and National Policies,” according to a statement.

“It has been recognized that Sri Lankan Airlines Company Limited as well as its subsidiary companies are needed to be restructured by handing over a considerable amount of shares and the management of the entity of Sri Lankan Airlines Company Limited to investors selected through a transparent procurement process,” the statement said.

Sri Lanka airlines by the end of the third quarter, had a sovereign guaranteed bond of 175 million US dollars, owned loans to the People’s Bank and Bank of Ceylon of 386 million US dollars.

Another 325 million dollars were owed to Ceylon Petroleum Corporation, Airport and Aviation Services and Civil Aviation Authority.

SriLankan had reduced losses in recent years by re-negotiating it leases and cutting some staff costs. The airline is now facing a drain of pilots amid higher taxes and an economic crisis. (Colombo/Nov02/2022)

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