BIA second terminal project to begin soon following JICA’s funding renewal
The second terminal construction of the Bandaranaike International Airport (BIA) extension project will begin shortly after the delay of over one year under a concessionary Japanese International Agency (JICA) loan scheme, Minister of Ports, Shipping and Aviation Nimal Siripala de Silva said.
The construction of the second terminal at the BIA began at a cost of Rs. 145 billion under the ‘JICA’ soft loan scheme. in 2020, but has been stalled since 2022 as a result of Sri Lanka’s economic crisis. The project was suspended until Sri Lanka’s external debt restructuring was finalised.
Airport and Aviation Services (Sri Lanka) Ltd. (AASL) and the External Resources Department (ERD) of the Finance Ministry held discussions with the JICA this week to restart funding for the BIA terminal II project.
Minister de Silva said that AASL will need to negotiate additional financing with JICA. Access Engineering has been building the foundation up to the ground floor using AASL’s funds, with completion expected by November.
A new contractor, mandated to be Japanese, will be appointed approximately nine months later to continue the project.
Originally, the $564 million contract was awarded to Taisei Corporation in 2020 but was halted due to a funding freeze by JICA.
In 2022, allegations were leveled against the Ministry of Ports, Shipping and Aviation for soliciting a bribe from Taisei Corporation Japan from the BIA expansion project but it was subsequently dismissed by the Bribery and Corruption Authority due to the lack of evidence.
JICA and the ministry jointly rejected the allegations claiming that the project funding was suspended due to economic crisis and ongoing external debt restructuring process at that time, a senior official of the ministry said.
AASL reported total revenue of Rs. 14,543 million in the first four months of 2024, comprising Rs. 2,697 million from aeronautical activities, Rs. 11,794 million from non-aeronautical sources, and Rs. 51 million from other income, according to a fiscal performance report by the finance ministry.
AASL achieved a pre-tax profit of Rs. 12,049 million, marking a 3.6 per cent increase from Rs. 11,624 million in the same period of 2023.
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