Sri Lankan low-cost carrier Mihin Lanka will take over flag carrier SriLankan Airlines' five times weekly Colombo-Bahrain service starting 1 September.
SriLankan Airlines will then codeshare with Mihin Lanka on the route, says an airline official.
Mihin Lanka, which has one Airbus A320 and A321 aircraft in its fleet, also plans to replace its A320 with an A321. It is expecting to take delivery of a third aircraft in winter 2012.
Schedules in Innovata show that Mihin Lanka will compete with Gulf Air on the Colombo-Bahrain route.