Sri Lankan airline deal with Emirates still in the air

NEW DELHI, Nov 27, 2007 (AFP) – SriLankan Airlines wants a new management contract to be signed soon with Dubai-owned Emirates, chief executive Peter Hill said Tuesday, forecasting a “tough” year for the island’s carrier. The Colombo government is holding another meeting on January 8 with Emirates to discuss the renewal of the 10-year management contract of SriLankan Airlines that runs out next March, an airline official said.

“The negotiations between the government and Emirates have been going on for 18 months. I would have liked to have seen them resolved by now,” Hill admitted to reporters in New Delhi.

The Sri Lankan national carrier, in which Emirates holds a 43.6 percent stake, needs a decision to push ahead with its business plans, he said.

Hill was in the Indian capital to announce that SriLankan Airlines had become the first foreign carrier to operate 100 flights a week to India.

SriLankan Airlines, formerly known as Air Lanka, entered into the strategic partnership with Emirates in 1998 in which the Colombo government retained a majority stake, but gave full power to Emirates to run the airline.

Media reports say the Sri Lankan government wants a bigger role in managing the carrrier and