Mihin Lanka flies into turbulance

[TamilNet, Saturday, 15 March 2008, 23:41 GMT]
Eleven months after beginning operations, Mihin Lanka, a low cost Air Lines fully owned and funded by the Government of Sri Lanka (GOSL), is facing a loss of Rs.300 million, and if the economic performance does not improve soon, the airline may face bankruptcy, airline industry observers in Colombo said.

The trouble-plagued air lines was launched 24 April, 2007 to provide low cost flights to Sri lankans employed in Middle East countries, to passengers travelling to India, and also to be used by the Sri Lanka's President and his delegation during official trips abroad.

The initial destinations were, however, limited to Dubai, Trichy, and Kochin.

Opposition politicians in Sri Lanka parliament alleged that $75 million needed to launch the air lines was drawn from government establishments.

Close relatives and associates of the Sri Lankan President, including his brother Gothapaya Rajapakse, Chief of Sri Lanka Air Force (SLAF) Rohan Goonetilake, and Secretary to the President Lalith Weeratunge were appointed to the board of Directors of the Air Lines.

Sajith Vas Goonewardene, secretary to the President with no aviation industry experience was named as Chairman and Chief Executive Director.

Detractors of the air line allege that the new airline was floated with funds obtained from Employees Thrift Savings Fund, and due to the anticipated loss of at least Rs.300 million, GOSL will likely not be able to pay back the funds, sources said.

Industry observers say that since begining operations, the airline had developed a reputation for poor service and delays, and the airline faces an uncertain future.