By: Staff Writer

July 15, Colombo (LNW): Sri Lanka’s Commercial High Court has extended an enjoining order barring any legal proceedings to wind up the country’s national carrier, SriLankan Airlines, over a bond default, until July 30. The extension was granted following submissions by legal representatives of the airline and the Trustee of the defaulted bond, as the legal battle over a significant financial default continues to unfold.

The dispute arises from a $175 million international bond issued by SriLankan Airlines, which the airline defaulted on. With accrued interest, the outstanding claim has now ballooned to approximately $209 million.

The bond in question was issued with a government guarantee in 2019 to support the financially troubled airline’s operations. However, amid the country’s worsening economic crisis over the last few years, SriLankan Airlines has struggled to meet its debt obligations.

Lawyers representing the Trustee of the bond had earlier moved to demand full payment of the defaulted amount and signaled intentions to initiate legal proceedings to wind up the airline. In response, the legal team for SriLankan Airlines filed for an enjoining order, successfully halting any winding-up action temporarily.

At the recent court hearing, attorneys for SriLankan Airlines argued that under Sri Lankan company law, the foreign representatives of the bondholders do not have the legal standing to seek a winding-up order against the airline.

They further informed the court that the government, as the sole shareholder of the airline, is currently engaged in negotiations with bondholders in an attempt to reach a mutually acceptable solution without triggering liquidation.

SriLankan Airlines, which has been grappling with chronic losses and operational inefficiencies for over a decade, is at the center of the government’s state-owned enterprise reform agenda. The airline has posted significant financial losses year after year and was further hit by the COVID-19 pandemic and the country’s broader economic collapse in 2022, which saw Sri Lanka defaulting on its sovereign debt for the first time in its history.

The current legal impasse also raises questions about the implications for Sri Lanka’s broader debt restructuring program and its commitment to creditors. Legal experts point out that allowing SriLankan Airlines to be wound up would set a precedent with wide-ranging ramifications, particularly as the country continues to navigate a complex restructuring process with both bilateral and commercial creditors.

Meanwhile, bondholders are closely watching how the government addresses this dispute, especially amid wider privatization plans for the national carrier. The Finance Ministry had earlier announced a restructuring plan that could include strategic partnerships or full divestiture of SriLankan Airlines.

The case will be taken up again on July 30, with the court expected to hear further arguments on the legal standing of the bondholders and the government’s efforts to resolve the matter outside of litigation.

July 15, Colombo (LNW): President Anura Kumara Dissanayake yesterday (14) hosted Sultan A. Al‑Marshad, Chief Executive Officer of the Saudi Fund for Development (SFD), at the Presidential Secretariat to review existing development projects and chart a course for future collaboration.

The leaders evaluated ongoing SFD-funded initiatives across Sri Lanka and discussed strategic priorities for the next phase of cooperation. A key outcome from the meeting was Saudi Arabia’s interest in supporting the island’s digitalisation agenda, aimed at enhancing efficiency in public service delivery.

President Dissanayake reiterated the deep-rooted friendship between Sri Lanka and Saudi Arabia, thanking them for unwavering financial and logistical assistance provided during the recent economic downturn.

He emphasised that any new financing from the SFD will be directed towards initiatives identified by communities as most needed—ensuring that projects address real, on-the-ground priorities.

The delegation from Saudi Arabia included H.E. Khalid Hamoud Nasser Aldasam Alkahtani, Ambassador to Sri Lanka, and Dr Saud Ayid Al‑Shammari, Director General of Asia Operations at the SFD. Sri Lanka was represented by a senior ministerial delegation including Dr Anil Jayantha Fernando (Minister of Labour and Deputy Minister of Economic Development), Roshan Gamage (Senior Additional Secretary to the President), Dr Harshana Suriyapperuma (Secretary to the Ministry of Finance) and R.M.S.P.S. Bandara (Director General of External Resources).

Both sides expressed optimism that the renewed discussions would lead to impactful, people-centred projects—especially in the digital and infrastructural sectors—strengthening bilateral ties and supporting Sri Lanka’s ongoing recovery and development goals.

July 15, Colombo (LNW): Former SriLankan Airlines chairman Nishantha Wickramasinghe has been granted bail by the Colombo Magistrate’s Court following his arrest and detention by the Commission to Investigate Allegations of Bribery or Corruption (CIABOC) on graft allegations.

Chief Magistrate Thanuja Lakmali reviewed submissions from both CIABOC officials and the defence before making the decision. Wickramasinghe was released upon posting a cash bail of Rs. 50,000, and providing three sureties of Rs. 5 million each.

In addition to the bail terms, the court placed a restriction on his international travel pending the outcome of the investigation.

Authorities have indicated that further legal proceedings will follow, as the ongoing inquiry examines the allegations involving the former chairman’s tenure at the national carrier.

July 15, Colombo (LNW): The revered wild tusker known as ‘Bhathiya’, who had been receiving continuous veterinary care for severe injuries, died this morning in the Polpithigama area, marking a poignant loss for Sri Lanka’s wildlife conservation efforts.

Bhathiya had sustained serious gunshot wounds approximately two months ago, prompting an emergency response from a dedicated veterinary team led by Professor Ashoka Dangolla, former Dean of the Faculty of Veterinary Medicine at the University of Peradeniya.

Despite tireless efforts to stabilise his condition, including daily treatment and the use of specialised care protocols, Bhathiya’s health continued to deteriorate.

The situation became more complicated when the tusker recently fell into a water pit, further aggravating his condition. In recent days, his mobility had declined significantly due to muscle wasting and poor blood circulation, with veterinarians describing his state as critical.

In a final effort to aid his recovery, the medical team attempted to reposition the elephant yesterday (14), hoping it would improve blood flow and relieve pressure on his limbs. However, Bhathiya’s body could no longer withstand the trauma and stress, and he succumbed to his injuries early the next day.

Estimated to be between 30 and 35 years old, Bhathiya was widely admired for his commanding stature and graceful build. His presence in the wild was symbolic of the country’s rich elephant heritage, and his loss has left a visible void in the Nikaweratiya and Polpithigama regions, where he was often sighted.

July 15, Colombo (LNW): A tragic road accident claimed the lives of two individuals when a car travelling along the Mahiyangana–Badulla main route veered off course and overturned into the Mahaweli Viyana Canal near the 17th-mile post at Mapakadawewa.

The incident occurred during the early hours of the morning, prompting an immediate and coordinated rescue effort by officers from the Mapakadawewa Police Training Academy, Mahiyangana Police, and concerned residents in the area. Despite the rapid response, both occupants of the vehicle were found trapped inside the submerged car.

Rescuers managed to pull the victims from the water and transfer them urgently to the Mahiyangana Base Hospital. However, hospital staff confirmed that the individuals had succumbed to their injuries by the time they arrived.

Authorities have launched an investigation to determine the exact cause of the accident, although initial reports suggest that loss of control may have contributed to the vehicle careening into the canal. The Mahiyangana Police are working with forensic experts and traffic investigators to gather further details.

July 15, Colombo (LNW): An independent four-member committee has been established to investigate allegations of financial mismanagement and administrative lapses at Sabaragamuwa University, following directives issued by the Committee on Public Enterprises (CoPE).

The Ministry of Education, Higher Education, and Vocational Training announced the formation of the inquiry team, which is expected to present its findings within two months.

The committee, convened by Secretary to the Ministry, Nalaka Kaluwawa, reflects the government’s response to mounting concerns over governance issues at the institution. These concerns were initially flagged during CoPE sessions, which called for a formal inquiry into how public funds and university resources were being managed.

Heading the investigation is retired Supreme Court Justice Vijith K. Malalgoda, whose legal expertise is expected to lend considerable weight to the inquiry process. He is joined by Professor Gamini Senanayake, a former Vice-Chancellor of the University of Ruhuna; W.M.C. Bandara, previously an Additional Secretary to the Ministry of State Resources and Enterprise Development; and Hasanthi Pathirana, Assistant Internal Auditor of the University Grants Commission, who will serve as the committee’s convener.

The scope of the investigation includes examining procurement processes, financial reporting systems, staff appointments, and other administrative procedures that may have deviated from standard regulatory frameworks.

The committee is also expected to recommend reforms to improve governance and transparency at the university level.

July 15, Colombo (LNW): A government-funded initiative aimed at modernising Sri Lanka’s railway telecommunication infrastructure has failed to yield its intended benefits, according to a recent report by the National Audit Office.

The audit reveals a series of operational and managerial lapses that have rendered the system ineffective, despite the project’s official completion nearly five years ago.

Originally launched to improve coordination and safety across the island’s railway network, the project was finalised in November 2020. However, the audit findings suggest that the upgraded system has not been integrated into daily operations in any meaningful way.

The report highlights a lack of cooperation from railway personnel, both at individual and departmental levels, in embracing the modernised system.

One of the most significant issues raised in the audit is the Department of Railways’ failure to ensure proper maintenance through the private telecom contractor, as was contractually mandated. This, compounded by the absence of a structured oversight mechanism, has resulted in critical components of the system falling into disuse or disrepair.

In an effort to promote the system’s usage, a circular was issued requiring railway staff to use the new communication equipment for official duties. However, the Audit Office has found widespread non-compliance among officers, some of whom have continued using alternative or outdated methods, undermining the investment made in new technology.

The National Audit Office has recommended that disciplinary measures be taken against officials who disregarded the circular and neglected their responsibilities. It further called for a nationwide strategy to expand signal coverage and build the necessary infrastructure to support uninterrupted service delivery, suggesting that without such improvements, the long-term goals of the modernisation project may never be realised.