Columns

• National carrier’s new chairman begins dispute settlement dialogue with Airbus over issues arising from the corruption-ridden purchase deal in 2013
• In talks with President Dissanayake, Indian Prime Minister Modi will review progress made in fostering greater partnerships and cooperation
• A lengthy resolution ready for the removal of suspended police chief Deshabandu
• Concerns arise over ministerial remarks that draw contradictions following Bimal’s comments on K-8 crash

By Our Political Editor

First came the bombshell revelation: Kapila Chandrasena, the former CEO of SriLankan Airlines, pocketed a staggering two million US dollars in bribes from aircraft manufacturer Airbus. Now, he and his family reside comfortably in Australia, while investigators scramble to untangle the legal web for his extradition. The audacity of this scandal left the nation reeling.

But the turbulence did not end there. The national carrier’s cumulative losses over just two years soared to an eye-watering Rs 448.7 billion—equivalent to 1.5 billion US dollars. They have been funded periodically by the Treasury. This amounts to half of the International Monetary Fund (IMF) bailout package to Sri Lanka. To put this in perspective, that is enough to construct a port like the one in Hambantota and still save what remained. China extended loans totalling US$ 1050 million for this project. It is also the construction cost for several highways, like the one between Mirigama and Kurunegala. That cost Rs 1.2 billion. For a country still grappling with the aftershocks of bankruptcy, this financial haemorrhage is a crisis that touches every Sri Lankan.

This file picture shows SriLankan Airlines’ one-time CEO Kapila Chandrasena being taken to courts to face corruption charges in courts. He is belived to be in Australia. The Government is exploring legal avenues to seek his extradition

Amidst this chaos, the newly appointed chairman, Sarath Ganegoda, has taken the reins with a mission to reclaim what is owed. He has locked horns with Airbus over unresolved issues stemming from the ill-fated procurement of aircraft. SriLankan Airlines is demanding the return of pre-delivery payments totalling 19.2 million US dollars, now ballooned to 23.3 million with accumulated interest. But that is not all—the airline is also pursuing a hefty 200 million US dollars in cash compensation.

In an ongoing dialogue with Airbus, Ganegoda has presented a series of demands as terms of settlement for the dispute over the aircraft order. These terms, subject to approval by the NPP-JVP government, are seen as a precursor to withdrawing legal action. Currently, there is an active case regarding the matter. Highlighting the staggering losses incurred by SriLankan Airlines between 2014/2015 and 2023/2024, Ganegoda has requested Airbus to provide four new A330-900 aircraft free of charge this year.

SriLankan Airlines had entered a deal with Airbus in 2013 for the purchase of six Airbus A330-300 and four A350-900 aircraft. However, this agreement was later revealed to be riddled with corruption and irregularities. Only the name of the airline’s CEO, Kapila Chandrasena, transpired publicly both in Sri Lanka and abroad. Since then, it has come to light that there were other Sri Lankans involved. Last month, Deputy Minister Harshana Suriyapperuma informed Parliament of corruption within SriLankan Airlines, both domestically and internationally. Despite a budgetary allocation of twenty billion rupees for the national carrier for the current year, he clarified that these funds would not be used for operational purposes. He also disclosed that SriLankan Airlines had been paying a monthly instalment of USD 900,000 for three aircraft that had remained unused for several years. Another source familiar with the developments said that the deputy minister’s claim was only a “tip of the iceberg” and that there is “more to discover if a search is carried out within.”

In an ongoing dialogue with Airbus, Ganegoda has also placed before them a series of other demands as terms of settlement over the dispute over the order. These terms are subject to approval by the NPP-JVP government and are considered a prelude to calling off legal action. There is at present an ongoing case. Noting that SriLankan Airlines suffered a staggering loss between 2014/2015 and 2023/2024, Ganegoda has asked Airbus to provide SriLankan Airlines four new A330-900 aircraft free of charge. The total amount SriLankan is seeking from Airbus is US$ 232.6 million, together with the new aircraft, according to Gandegoda, who points out that “the adverse financial situation has a direct impact on the country’s economy.”

The SriLankan Airlines chairman has told Airbus that the national carrier wants to recover in cash all costs and expenses incurred by way of pre-delivery payments for the A-350-900 purchase agreement. He is seeking a settlement payment made to lessors and other vendors (Rolls Royce – Thales Avionics) and the costs pursued by the airline in pursuing redress. Asserting that the image of SriLankan Airlines has taken a bad beating over the Airbus deal (under the Mahinda Rajapaksa administration), the chairman has offered to name a team for further negotiations if they are agreeable. He has expressed the view that such a move could enable Airbus to assist with engineering and flight operations of the national carrier.

Other demands placed on Airbus by the new management of SriLankan Airlines are:

• A request for Airbus to negotiate with Rolls Royce (RR) a waiver of the following accounts:

(1)    Rolls Royce claims of US dollars 26 million together with accrued interest until late December last year amounting to US dollars 11.4 million for the cancellation of Trent XWB Agreements with Rolls Royce pursuant to the termination of Aercap leases for four (04) A350-900 aircraft.

(2)    Rolls Royce claims for 103 million US dollars together with accrued interest until late December last year for US dollars 18.9 million for the cancellation of Trent XWB agreement with Rolls Royce pursuant to purchase agreement for four (04) A350-900 aircraft.

• Cash settlement paid to Thales Avionics IMC for the cancellation of IFE (In-Flight Entertainment) systems for eight (08) A350-900 aircraft amounting to US dollars 2.2 million together with acquired interest until last December amounting to US dollars 1.5 million.
• Legal fees incurred to date (including ICC fees) of US dollars 6 million.

As reported in these columns on December 15 last year, the then Chief Executive Officer (CEO) of SriLankan, Kapila Chandrasena, was sanctioned by the United States for involvement in corruption. He accepted a bribe in exchange for ensuring that the national carrier purchased Airbus aircraft over market value. As part of the US action, Chandrasena and his family are also designated. They are barred from visiting the United States. It has been confirmed that he received two million US dollars as kickbacks, with a further 16.84 million US dollars pending. Chandrasena and family are now known to be living in Melbourne, Australia.

Chandrasena came to the limelight after a five-member “Board of Inquiry” brought forth a 136-page report which highlighted several malpractices and irregularities in SriLankan Airlines. The report was released in March 2015 by the Board of Inquiry headed by J. C. Weliamuna, Attorney-at-Law. It noted that Chandrasena assumed duties as CEO in August 2011 on a three-year contract which had thereafter been renewed. It said he had been appointed despite a purported claim by SriLankan Chairman Nishantha Wickremesinghe that he did not want him. He had in fact stated this position to “his brother-in-law (former President Mahinda Rajapaksa)….

Things came to a climax when a transaction (later cancelled at great cost to the country) between SriLankan Airlines and Airbus transpired in a case between the UK’s Serious Fraud Office and the aircraft manufacturer. It was at the Royal Courts of Justice Strand, London, in January 2020. The judgement, delivered by Rt. Hon. Dame Victoria Sharp, President of the Queen’s Bench Division, with reference to Sri Lanka, said:“The second count alleges that contrary to section 7 of the Bribery Act 2010, between 1 July 2011 and 1 June 2015, Airbus SE failed to prevent persons associated with Airbus SE from bribing others concerned with the purchase of aircraft by SriLankan Airlines from Airbus, namely directors and/or employees of SriLankan Airlines, where the said bribery was intended to obtain or retain business or advantage in the conduct of business for Airbus SE.

“SriLankan Airlines (SLA) is the national carrier of Sri Lanka. At the material time, the Government of Sri Lanka owned 99.1 percent of SLA. In 2013, Airbus engaged the wife of a person concerned with the purchase of aircraft from SLA through a straw company (the Company of Intermediary 1). Pursuant to the engagement, Airbus employees offered up to $16.84 million to Company Intermediary 1 to influence SLA’s purchase of 10 Airbus aircraft and the lease of an additional 4 aircraft. In fact, only $2 million of the $16.84 million was paid. The Company of Intermediary 1 was approved by Airbus employees as a BP. To disguise the identity of the person behind BP, Airbus employees misled UKEF. (UK Export Finance) . UKEF expressed dissatisfaction with an application made by Airbus in November 2014 for export credit financing, and then with the details about the BP (the relevant agent) which Airbus subsequently submitted. UKEF asked a series of questions about the BP, including why they had been employed as such, when their CV suggested they had little aviation experience and that they were domiciled and paid outside Sri Lanka……”

Modi visit

The behind-the-scenes dialogue between SriLankan and Airbus continues over an issue that affects the wellbeing of every citizen. This is by saving enormous amounts of money that is periodically pumped to keep the national carrier afloat at great cost. They could have been used for development work that benefits the people. Other than this, there were many other developments this week. One is the visit of Indian Prime Minister Narendra Modi on the night of April 4. He is accompanied by Foreign Minister Subramaniam Jaishankar, National Security Advisor Ajit Doval and Foreign Secretary Vikram Misri. He will take part in various engagements in Colombo and fly to Anuradhapura on April 6 before leaving Sri Lanka. According to a Foreign Ministry statement, “While in Sri Lanka, the Indian Prime Minister is scheduled to visit Anuradhapura to pay homage to the sacred Sri Maha Bodhi and will inaugurate several projects implemented in Sri Lanka with the assistance of the Government of India. A number of memoranda of understanding inked between the two countries are also expected to be exchanged during this visit.” Significant enough, he is not visiting Trincomalee as expected, though two main agreements relate to development work in this district. One is the solar power project in Sampur, and the other is the building of an oil pipeline starting from India and ending at the World War II storage terminals in Trincomalee. A government source said they preferred Premier Modi to visit the Sri Maha Bodhi in Anuradhapura, close to President Anura Kumara Dissanayake’s homeground.

The External Affairs Ministry in New Delhi said that Premier Modi and his entourage are visiting Sri Lanka en route to New Delhi from Thailand. He will be in Thailand from April 3 to 4 for the BIMSTEC conference. It said that this would be the first physical meeting of the BIMSTEC leaders since their fourth meeting in Kathmandu, Nepal, in 2018. Before that, the fourth summit was held in Colombo in March 2022 in virtual format. The EAM statement said, “During the visit, the Prime Minister will hold discussions with the President of Sri Lanka to review progress made and the areas of cooperation agreed upon in the joint vision of fostering partnership for a shared future adopted during the Sri Lankan President’s state visit to India. The Prime Minister will also have meetings with senior dignitaries and political leaders. As part of the visit, the Prime Minister will also travel to Anuradhapura for the inauguration of development projects implemented with Indian financial assistance.

“The Prime Minister last visited Sri Lanka in 2019. Earlier, the President of Sri Lanka paid a state visit to India as his first visit abroad after assuming office. India and Sri Lanka share civilisational bonds with strong cultural and historic links. This visit is part of regular high-level engagements between the countries and will lend further momentum in deepening the multi-faceted partnership between India and Sri Lanka. The Prime Minister’s visit to Thailand and Sri Lanka and his participation in the 6th BIMSTEC summit will reaffirm India’s commitment to its Neighbourhood First policy, Act-East policy “MAHASAGAR” (Mutual and Holistic Advancement for Security and Growth Across Regions) vision, and vision of the Indo-Pacific.”

Move to remove Deshabandu

Another issue in focus this week is the case of onetime Inspector General of Police Deshabandu Tennekoon. The Supreme Court is due to take up for argument nine fundamental rights petitions against his appointment as IGP on May 6, 7 and 8. Earlier, in the interim, they issued an order that the President appoint a suitable person to act as IGP until the case is determined. In view of the presidential elections pending, then President Ranil Wickremesinghe, however, did not appoint one. After President Anura Kumara Dissanayake assumed office, he named Priyantha Weerasooria to act as the Police Chief.

In keeping with provisions of the Removal of Officers (Procedure) Act of 2006, the government has prepared a lengthy resolution, which refers to the nine fundamental rights petitions. It lays down that where the inquiry is in relation to the Inspector General of Police, the Committee shall consist of three persons, of which the Chairman shall be a Judge of the Supreme Court, nominated by the Chief Justice, the Chairman of the Police Commission and a person who has reached eminence in the field of law or management of public administration. The removal by the President of the holder of either of the offices specified on any one or more of the grounds. This is after the presentation of an address of Parliament supported by most of the total number of Members of Parliament (including those not present) for the appointment of a Committee of Inquiry : Provided, however, that no resolution for the presentation of such an address shall be entertained by the Speaker.

The resolution for the removal of Deshabandu Tennekoon as Inspector General of Police signed by 115 MPs is now listed in the Order Book of Parliament and listed in  the issue of March 26. It does takes note of the nine fundamental rights petitions now pending before the Supreme Court. In choosing to go ahead with a resolution notwithstanding the cases pending before the country’s highest court underscores the NPP-JVP government’s hurry in seeking an end to the ongoing issue. The resolution identifies Deshabandu Tennekoon as Senior Deputy Inspector General of Police Western Province and acting Inspector General of Police. Here are selected, edited highlights of the 31-paragraph lengthy resolution:

“On or about December 30, 2023, Deshabandu Tennakoon, in his capacity as the Senior Deputy Inspector-General of Police of the Western Province and Acting Inspector-General of Police, illegally caused an armed team of Police officers belonging to the Colombo Crime Division, consisting of eight members, to be sent to Pelena, Weligama, in a surreptitious manner and thereby committed an act of misconduct; He illegally caused an armed team of Police officers belonging to the Colombo Crime Division consisting of eight members (they are named) to be sent to Pelena, Weligama and thereby committed a gross abuse of power; He caused the said armed team of Police officers belonging to the Colombo Crime Division consisting of eight members to use the Vehicle No: WP PK 7225 belonging to the Police, to go to Pelena, Weligama to facilitate their engagement in an illegal activity or crime, namely to open fire at W 15 Hotel at Pelena, Weligama  and thereby committed an act of misconduct.

“He illegally caused the said armed team of police officers, consisting of eight members, to go to Pelena, Weligama, to facilitate their engagement in an illegal activity or crime, namely, to open fire at W 15 Hotel at Pelena, Weligama, and thereby committed a gross abuse of power of his office; He, knowing very well that the said armed team of police officers belonging to the Colombo Crime Division had engaged in an illegal activity or crime, namely, opening fire at W 15 Hotel at Pelena, Weligama, has failed to take any action in that regard and thereby committed an act of misconduct…

“Knowing very well that two of the officers belonging to the Colombo Crime Division, namely Police Sergeant 57241 Maningamuwa Gedera Upul Chaminda Kumara and Sub Inspector Roshan Madhuranga had received gun-shot injuries while engaging in illegal activity or crime at Pelena, Weligama, he has failed to take any action in that regard and thereby committed an act of misconduct…

“He, knowing very well that two armed police officers belonging to the Colombo Crime Division had received gun-shot injuries in the course of engaging in the aforesaid illegal activity or crime at Pelena, Weligama, has failed to take any action in that regard and thereby committed a gross abuse of power; He, knowing very well that two armed police officers belonging to the Colombo Crime Division, had received gun-shot injuries in the course of engaging in illegal activity or crime at Pelena, Weligama, has instructed the other members of the said armed team of police officers to surreptitiously return to Colombo without the injured being taken to the nearest hospital and thereby committed a gross abuse of power.

“He conspired with the other members of the said armed team of police officers and facilitated their engagement in an illegal activity or crime, namely, to open fire at W 15 Hotel at Pelena, Weligama by aiding and abetting them and thereby committed an act of misconduct;  During the period from February 27 2025 to March 19 2025, he being the Inspector-General of Police went into hiding by disobeying the Orders made by the Hon. Magistrate of Matara February 27, 2025 and the other orders incidental thereto including the issuance of warrants in that case, and thereby committed an act unbecoming and unsuitable to the office of the Inspector General of Police.”

A broader accusation against Deshabandu Tennekoon centres around the names of a group of people, listed in the resolution. They relate to the protests, or aragalaya in 2022. The resolution notes that he who was “entrusted with the duty of maintaining law and order of the whole country has, by committing one or more of the acts of misconduct and/or acts of gross abuse of power, brought the office of the Inspector-General of Police of the country and the Police Department to disrepute. It adds that he “did fall short of the high standard expected of a person who holds office as the Inspector General of Police of the country and therefore has become unsuitable to hold office.”

The resolution concludes: “And whereas, in order to fulfill the obligations imposed on the Members of Parliament by the Constitution, to safeguard the independence and integrity of the overall system of administration of justice; to safeguard the trust of the people of this country have reposed in the Office of the Inspector General of Police and the Police Department as one of the primary law enforcement agencies which is entrusted with the task of the creation and preservation of a just and free society, this Parliament resolves that a Committee of Inquiry be appointed.”

Upon the receipt of the report of the Committee where there is a guilty finding, the Speaker shall deal with the resolution listed in the Order Book. Upon the majority of MPs (including those not present) voting in favour, the IGP, according to the Act, “shall forthwith be removed from office by the President.”

Air Force contradicts Bimal’s remarks

Another development of importance is the continuance of contradictory remarks by ministers over key issues. The latest are comments by Bimal Ratnayake, Minister of Transport, Highways, Ports and Civil Aviation. He declared that the Chinese-manufactured K-8 trainer aircraft that crashed in Wariyapola in the Kurunegala district was due to pilot error. He claimed that he had received a copy of the investigation report from the Technical Committee and asserted that the aircraft and the engine were in good condition. “We cannot allow outdated aircraft to fly. The pilots of this aircraft were still in training, and an error was made on their part,” he said during a visit to a school in Padeniya near Kurunegala.

Top brass at the Sri Lanka Air Force were embarrassed. Their commander, Air Marshal Bandu Edirisinghe, had only named a Board of Inquiry to probe the crash. The Sunday Times  learnt that no findings, preliminary or otherwise, have been officially made so far. However, a source familiar with the incident and familiar with trainer aircraft said the Karakoram-8 basic cum Advance Jet trainer is co-developed by the Aircraft Manufacturing Factory (AMF) Complex at Kamra, Pakistan, and the China Nanchang Aircraft Manufacturing Company (CNMC). “The trainer aircraft is always operated under the direct supervision of a trained, qualified instructor who must pass an exam for this purpose. Hence, there is only one trainee accompanying him,” he said and added that “pilots in the aircraft were still in training is factually inaccurate. It never happens in any Air Force or air academies where training is carried out.”

• Asked to comment on what could be the probable cause, the source said, “I will not come to any conclusion on the Wariyapola incident. However, to me, the ejection of the trainer and the trainee within seconds, ahead of the crash, could be the result of their discovering a snag. They had the time to eject. Therefore, blaming it on the trainer and his trainee, without a proper probe, is unfair and premature. It is the Board of Inquiry that must determine what the exact cause may have led to a malfunction. Let us wait,” he said.

Another reported blunder many times came from the energy minister. He blamed a monkey for the nationwide blackout, earning headlines worldwide. Later, his own Ceylon Electricity Board (CEB) disproved him. Such contradictory messages, to say the least, cause confusion and sometimes blur real issues.