Rat Grounds Sri Lankan Airline, Raises Investor Concerns

Tue Feb 27 2024
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COLOMBO: Sri Lanka’s national airline, SriLankan Airlines, faced a chaotic situation as a rat was discovered aboard one of its Airbus A330 flights, leading to a three-day grounding of the plane.

The stowaway rodent triggered a thorough search of the aircraft to ensure it hadn’t damaged critical components, causing disruptions to the airline’s schedule.

An unnamed airline official confirmed the incident, stating that the rat was found dead and the plane has since resumed flights. However, the grounding had a significant impact on the airline’s operations, exacerbating its already precarious financial situation.

With accumulated losses exceeding $1.8 billion as of March 2023, SriLankan Airlines struggles with financial woes. Currently, three other aircraft remain grounded for over a year out of its fleet of 23, with the carrier lacking foreign exchange to cover mandatory engine overhauls.

Aviation Minister Nimal Siripala de Silva expressed concerns that the incident might deter potential investors interested in taking over the debt-ridden airline. Despite efforts by successive governments to sell the airline, including offering it for one dollar, there have been no takers. The airline’s misfortunes stem from the termination of a management agreement with Emirates in 2008, following a dispute with former President Mahinda Rajapaksa.

Ironically, one of SriLankan Airlines’ most profitable years was in 2001, when it received insurance payouts after aircraft were destroyed in an attack by the Tamil Tigers separatist movement. This incident, coupled with the removal of excess capacity, contributed to the airline’s income.

The International Monetary Fund (IMF), which bailed out Sri Lanka with a $2.9 billion loan last year, emphasizes the burden that state-owned enterprises like SriLankan Airlines pose on the national budget. The rat incident underscores the challenges facing the airline and the urgency of addressing its financial instability to attract potential investors.

 

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