Sri Lankan domestic carriers are seeking to expand services, following the deregulation that has followed the ceasefire between Tamil rebels and the government. New helicopter and seaplane services are also planned.

Three carriers currently operate several flights a week to northern Jaffna and plan to fly to other destinations, mainly to cater to tourists. H M C Nimalsiri, director general of the country's civil aviation and chief executive of the new civil aviation authority, says the authority has approved the resumption of domestic flights to all airports and allowed self-handling by local operators. Two foreign and three local applicants want to start helicopter services.

"We're now working out the environment in which such operations can be allowed and have to clear defence concerns with the defence ministry and the air force," he says.

According to SriLankan Airlines chief executive Peter Hill, the carrier hopes to begin operating two amphibious aircraft by November.

The cut-throat competition at the beginning of the year on the lucrative Jaffna flights, with domestic carriers seeking to undercut each other on price, appears to have eased.

The route had been virtually monopolised by Lionair for years. It flew charters for the air force ferrying troops to Jaffna. The entry of Expo Aviation and Serendib Express led to a price war and fears that the market was not big enough for more than two operators.

All three operators found it difficult to fill up the flights with the re-opening of the Jaffna highway and fall in demand for air travel. The competition prompted the civil aviation authority to impose a seat cap of 475 a week on each carrier. All three have joined forces to set prices at comparable levels.

Source: Flight International