Sri Lanka Aviation

The restructuring of Rs. 91.3 billion in loans obtained from State banks by SriLankan Airlines has now been completed, Ports and Civil Aviation and Energy Minister Anura Karunathilaka revealed in Parliament yesterday (6).

https://dailynews.lk/2026/05/07/loca...ans-concluded/

Chair to be appointed to SriLankan Airlines
A Chairperson will be appointed for the SriLankan Airlines in the coming days, while the process of selecting a Chief Executive Officer (CEO) has reached its final stage, according to the Civil Aviation Ministry.

Speaking to The Daily Morning, Deputy subject Minister Janitha Ruwan Kodithuwakku said: "A Chairperson will be appointed in the coming days. When it comes to the CEO, the relevant interviews have been held and the process is at the final stage now." He further stated the absence of permanent appointments to the two top positions has not affected the Airline’s operations.

It was reported recently that the SriLankan Airlines has been functioning without confirmed full-time leadership in both the roles for some time, with interim arrangements currently in place. The post of the Chairperson went vacant following the resignation of Sarath Ganegoda in March 2026, while the CEO position has remained on an acting basis for over a year. According to publicly available information, Dimal Arandara is serving as the Acting Chairperson, while Yasantha Dissanayake holds the post of the Acting CEO. The CEO role has been in an acting capacity since March of last year (2025), and the Chairperson position since 31 March 2026.

The leadership vacuum comes at a time when the national carrier is facing external pressures, including global uncertainties linked to tensions in the Middle East (ME), which have had an impact on operations, particularly in terms of the cash flow. Speaking previously, Kodithuwakku noted that the Airline currently operates a fleet of 23 aircraft and continues to face financial strain due to external factors such as fuel-related challenges. He added that the Government is considering a restructuring of the SriLankan Airlines, with a decision on the model expected within the next two to three months. The proposed restructuring is expected to focus on internal management reforms, although no final decision has yet been taken.

The SriLankan Airlines operates passenger and cargo services connecting Sri Lanka with destinations across Asia, Europe, the ME and Australia, and continues to play a key role in supporting tourism, trade and international connectivity.

Source: The Morning

Colombo, May 8 (Daily Mirror) - Former Chief Executive Officer of SriLankan Airlines, Kapila Chandrasena, was found dead at his residence in Kollupitiya under suspicious circumstances, police said.

https://www.dailymirror.lk/breaking-...ead/108-339756

Current status of the Airbus deal

During the presidency of Mr. Mahinda Rajapaksa in the years 2012-2013, a massive agreement worth USD 2.3 billion was signed under the leadership of Mr. Kapila Chandrasena, the then CEO of SriLankan Airlines, to purchase 10 aircraft (A330 and A350 models) from Airbus. This transaction, carried out with the aim of replacing old aircraft and modernizing the airline, later emerged as a massive international bribery scandal.
International investigative agencies, including the UK's Serious Fraud Office (SFO), confirmed that Airbus had paid bribes worldwide, and as a result, in 2020, the company was forced to pay a fine of EUR 3.6 billion in the UK, France, and the US. Sri Lanka was also named as one of the main countries involved in this global bribery network.

It is primarily alleged that Airbus agreed to pay a bribe of between USD 16 million and 16.84 million to secure this aircraft deal. According to investigations, Kapila Chandrasena and his wife, Priyanka Neomali Wijenaike, established a shell company named 'Biz Solutions Inc.' in Brunei. Subsequently, nearly USD 2 million (approximately EUR 1.45 million) of the bribe money was circulated through a bank account in Singapore and then transferred to accounts in Australia and Sri Lanka. Additionally, names associated with the Rajapaksa family, such as Shamindra Rajapaksa, have been mentioned in connection with receiving smaller payments of approximately USD 160,000 through this bribery network.

Due to political interference, the purchase of aircraft at exorbitant prices, and massive corrupt practices, this deal directly contributed to SriLankan Airlines incurring massive losses amounting to hundreds of millions of US dollars over several years. In light of this situation, the new management of the airline, appointed in 2025, demanded USD 232.6 million in compensation from Airbus. The compensation claim included cash, payments made before aircraft delivery, and 4 free A330-900 model aircraft.

The legal proceedings related to this fraud intensified in 2026, and with the assistance of the Criminal Investigation Department, the Commission to Investigate Allegations of Bribery or Corruption (CIABOC) re-arrested Mr. Kapila Chandrasena on March 12, 2026. Subsequently, on March 19, 2026, the Bribery Commission made a controversial revelation at the Colombo Chief Magistrate's Court, stating that Mr. Kapila Chandrasena had provided a recorded statement claiming that LKR 60 million (approximately USD 461,000 at the time) from the bribe money was given to former President Mahinda Rajapaksa on three occasions. It was also revealed that another LKR 20 million was given to former Aviation Minister Priyankara Jayaratne.

However, Mr. Kapila Chandrasena later completely denied these allegations and payments through an affidavit, stating that the statement was forcibly obtained from him under threats and pressure, using names of family members like Namal Rajapaksa, and by denying him legal assistance. As per the latest developments, on May 5 or 6, 2026, Colombo Chief Magistrate Asanga S. Bodaragama granted bail to Mr. Kapila Chandrasena, imposing a travel ban, a cash bail of LKR 500,000, and three personal bails of LKR 10 million each. He, who was even subjected to US sanctions in 2024 due to this bribery incident, remains the main suspect. No indictments have been filed against the former President or the former Minister so far, and the Bribery Commission is continuing a comprehensive investigation into financial flows through international money laundering networks.

Vietnam Airlines has announced it will open a direct air route connecting Ho Chi Minh City and Colombo, Sri Lanka, starting in October 2026, with three round trips per week using Airbus A321 aircraft.

The Ho Chi Minh City – Colombo service is expected to commence in August 2026 with four round-trip flights per week. Passengers from Colombo will gain convenient connections via Vietjet’s extensive network to major economic, tourism, and financial hubs across the Asia-Pacific region, including Australia, Japan, South Korea, China, Singapore, Malaysia, Indonesia, Thailand, and more.

WEAIR, has announced that it has entered into a strategic operational agreement with a Ukraine-based cargo carrier holding a valid Ukrainian Air Operator Certificate (AOC) and applying for a Foreign Air Operator Certificate (FAOC) to support the commencement of cargo operations.

Until WEAIR obtains its Sri Lankan Air Operator Certificate (AOC), initial operations are planned to be conducted under the partner carrier’s FAOC framework, ensuring operational continuity and full regulatory compliance.

WEAIR Chief Marketing Officer Indrajit Joseph said: “As part of the proposed operations, the Ukraine-based cargo carrier is considering operating six (6) or more non-scheduled commercial cargo flights per season (a six-month period), using its own call sign and AOC to and from Colombo (CMB), as well as third countries under Seventh Freedom traffic rights.”

The story of SriLankan Airlines A350 order collapsed ✈️🇱🇰
The plan to buy an A350 flight to SriLankan Airlines is a deal that was discussed in the world. But in the end it didn't happen.

How the plan started
During 2013-2014, Sri Lankan did a deal with Airbus to buy 4 A350-900 flights.
The aim was to add a fuel efficient, modern aircraft to long-haul routes, especially London, Europe, Australia routes.

A350 is Airbus flagship wide-body aircraft. 25% less fuel consumption, more passenger comfort.

Why did the deal get messed up?
Started looking for this deal after the government shifted in 2015.
The main allegation was that the lack of transparency in the procurement process and the conditions of the aircraft lease agreement were unfair.

In 2016, SriLankan officially announced that the A350 order will be cancelled. Had to pay a penalty too.

The impact it had
The bad side:
Long-haul fleet modernization was delayed
Had to depend on the A330
Airline's reputation had an impact

The good side:
A350 lease payments වලින් monthly millions of dollars ඉතුරු වුණා
Airline is difficult to handle this cost during financial crisis
Maintained relationship with Airbus and bought A320neo, A321neo

This is the situation right now
SriLankan still doesn't have A350s by 2025. The fleet is from A320 family and A330 aircraft.

Airline is now focusing on leasing used aircraft and stabilizing the fleet. Buying a brand new wide-body like A350 is not an immediate plan.

Learnings
There is a big lesson from this incident - an aircraft purchase on a national airline cannot be a political decision. Commercial viability, long-term planning is important.

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