$170mn to be paid for airbus cancellation: Ravi

4 October 2016 05:42 pm - 10 - {{hitsCtrl.values.hits}}

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Sri Lanka will pay $170 million to AerCap Holdings NV, the world's largest independent aircraft leasing company, for cancelling four A350s ordered by the previous government, Finance Minister Ravi Karunanayake said on Tuesday.

The move comes as the government is in the process of finalizing a partner to revive the national carrier. It canceled four of eight A350 aircraft orders with Airbus Group SE.

"The cost will be $170 million for the cancellation and it will be paid for AerCap," the finance minister had told Reuters.

Minister Karunanayake later told Parliament that the state-run Sri Lankan Airlines do not require A350s as its longest flight time is around 10 hours.

Government officials have said the remaining four A350s are scheduled to be delivered towards 2020 but the government is yet to take a decision on them.

Sri Lankan Airlines, which has taken on lease seven Airbus A330-300s since 2012, has debt of around $3.25 billion.

It posted a group net loss of 16.3 billion rupees ($112.6 million) for the financial year through March 31, narrowing from the 31.4 billion rupees loss of a year earlier, due to lower oil prices. The carrier last posted a profit in 2009, a year after Emirates sold its stake in the venture.

The company also leased four of its Airbus A330 planes to Pakistan International Airlines Corp.

One of the Airbuses ordered and then cancelled by SriLankan airline is seen in Toulouse, France in July.

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Comments - 10

ANTON Tuesday, 04 October 2016 06:34 PM

NOW THERE WILL BE ANOTHER TAX ... "RAT " RAVI ADDED TAX.

Padmapriya Wednesday, 05 October 2016 01:50 AM

Sri Lanka must be a very rich country to give away money like this. Remember these are tax payers money. I do not understand how stupid Sri Lanka is when they write contract with foreign companies. Are people who profited from signing these contract going to pay back the money they made?

Tax Payer Wednesday, 05 October 2016 02:09 AM

Poor SL tax payers must pay for the damages done by the Rajapakse family business.

Ams Wednesday, 05 October 2016 05:08 AM

It is the inability of the present governent to find profit making routes. For this, BRAIN is an important resource. This government seems to be an expert on DIVESTMENT STRATEGY.

Think Wednesday, 05 October 2016 05:15 AM

Please bring seperate Law preventing government officials misusing the National Carrier. Because, after finalising the prospective partner, if regime change happens in the next general election then ...... like Emirates ......

ama Wednesday, 05 October 2016 05:17 AM

At lease keep one of A350 with us. It is a pride for the Airlne as well as to the Country. Please....

Ranjit Wednesday, 05 October 2016 05:39 AM

The Joint Oppositions Economic's Research unit spokesperson Mr Bandula Gunawardene, what have yougot to say about this loss?

ala Wednesday, 05 October 2016 06:00 AM

Take into custody all responsible officials concerned without talking nonsense!!!

Dr.Raghav Sharma Wednesday, 05 October 2016 09:59 AM

Waste of public money

Terminator> Wednesday, 05 October 2016 10:19 AM

If the previous government had purchased those Air Busses , one could have been definitely reserved for Rajapaksa family.

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$170mn to be paid for airbus cancellation: Ravi

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