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15 Oct, 2008 15:13:32
Sri Lanka budget airline to fly again
15 Oct, 2008 (LBO) – Sri Lankan budget airline Mihin Lanka’s new chairman says they are trying to re-launch the defunct carrier's operations by December 2008.
Raja Edirisuriya, former chairman of the State Engineering Corporation, Wednesday officially took over the government's airline operator Mihin Lanka which has been grounded since May.

He says that after the December resurrection, Mihin Lanka would be flying to the Middle Eastern destination of Dubai and South Indian cities of Trichy and Trivandrum.

These are the most heavily used routes by Sri Lankan migrant workers and those who go on pilgrimage or business travel.

“Other potential destinations are under high consideration,” says Edirisuriya.

Mihin’s flights were grounded earlier this year due to the airline's inability to pay debts that had mounted up to 15 million dollars.

The airline which began operations with a budget of 500 million rupees in March 2007 was funded mainly through over 2 billion rupees of loans from state banks and a budget allocation of 250 million rupees.

Reports said 3 billion rupees had been requested from the government next year to revive the airline.

Mihin Lanka has issued an international Request for Proposal (RFP) to lease two passenger Airbus 320 type (A320) or Boeing 737-800 (B737-800) on either wet, dry or lease to purchase basis.

Despite the budget carrier being a rookie in the airline business, the optimistic new head of Mihin Lanka says he’s looking for opportunities other than passenger and cargo transportation that would generate cash flows for the broke state owned airline.

“Do airlines indulge in other ancillary businesses?” he asked.

“Then should we not look at the aircraft maintenance providers' business, operating flying schools, duty free services, ground handling, in-flight catering, aircraft leasing, aggressive charter services, domestic air travel and other connected business?"

He says even though there are no immediate plans for merging Mihin Lanka with the island's national airline, Sri Lankan Airlines, some synergies already exists with the government aiming to harmonize their operations.

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READER COMMENT(S)
5. Prabhakaran Oct 25
Anyway It is better, to have a budget airline(while assuring the safty of the passengers) even for Sri Lankan citizens, as they are already hit with the high cost flight tickets.
4. Lalindra Oct 19
This is only another ego flight of the politicians ably assisted by self serving bureaucrats at public expense. Is it not possible for a public spirited person or an organization to request an injunction from courts to stop this wasteful expenditure until the previous 3 billion loss is accounted for?
3. Frequest flyer Oct 16
Why dont we invite another succsesful budget airline like Airasia to form a JV with Mihin.
2. Oct 16
Mihin Air is a joke. I think it’s a project that was dead on arrival. We are living in a period, where established airlines are collapsing. I think its time we kill Mihin and cut the losses.

Also, I don’t understand why they talk about merging with Sri Lankan. What synergies? That’s a joke . Mihin has no assets no strategic capabilities its only a dead duck with big bank loans and losses.

1. Ahmed Oct 15
I'm curious which of Dubai, Trichy and Trivandrum people go on Pilgrimage to???