The Sri Lankan government approved a proposal to cut aviation fuel prices, ground handling charges, and passenger taxes in order to boost tourism to the island.
The government-run website News.lk said that the proposal was tabled by the Sri Lanka Tourism Development Authority together with the Prime Minister’s office, the Ministry of Tourism, and the Civil Aviation Authority. The measures will initially be introduced for six months.
The measure was introduced in response to the drop in inbound tourism following the April 21 terrorist attacks in churches and hotels. According to the government, airlines reduced their daily supply of seats to Sri Lanka by 8,000 in the wake of the attack. The losses to the economy of the country are estimated at LKR51 million rupees (USD260,000) per day.
Tourism contributes over 10% to the Sri Lankan GDP.
According to the ch-aviation capacities module, Colombo International, Sri Lanka's only international gateway, currently sees 118,024 scheduled international departure seats on sale weekly. 27 carriers offer, in total, 558 weekly departures on 43 international routes. Flag carrier SriLankan Airlines (UL, Colombo International) is the dominant carrier with a 55.5% market share by capacity, while Emirates (EK, Dubai International), Qatar Airways (QR, Doha Hamad International), and IndiGo Airlines (6E, Delhi International) are the largest international carriers in Sri Lanka.
The Sri Lankan government earlier also adopted measures to support the tourism industry in the country, providing a relief period for capital loans and interest until the end of March 2020, reduced VAT rate, low-interest loans, and duty exemption for the import of security equipment.
