Sri Lanka (Commonwealth Union)_ Sri Lanka plans to start building a new terminal at Bandaranaike International Airport (BIA), financed by Japan, by June or July 2026, the Minister of Ports and Civil Aviation, Anura Karunathilaka, announced. Tender evaluations for the project have been completed, and the government expects to open price bids in January next year. “The plan is to award the contract and start construction by mid-2026,” Minister Karunathilaka told parliament.
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The project, initially handled by Japan’s Taisei Corporation, has been delayed for several years, partly due to Sri Lanka’s sovereign debt default, which forced the Japan International Cooperation Agency (JICA) to suspend its loan. Currently, the airport is operating over its capacity, causing congestion for both passengers and airlines. To alleviate the load, officials have built up 14 temporary check-in gates with private sector assistance, allowing the airport to accommodate an additional 10-20 aircraft each day.
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According to a recent Committee on Public Enterprises (COPE) statement, Taisei Corporation completed only 5.44% of the passenger terminal project, originally valued at Rs. 37 billion. Despite the slow progress, the full contract amount has already been paid to the company by Airports and Aviation Services (Sri Lanka) Limited (AASL). Work on the terminal stalled in December 2022 after JICA halted loan disbursements, following the Finance Ministry’s April 2022 circular addressing external debt repayment amid the country’s financial crisis. The delay has already added Rs. 1.3 billion in extra costs, while construction materials worth Rs. 1.55 billion remain in private warehouses owned by local subcontractors.
The Japanese government has now confirmed that funding will resume, with construction expected to restart in July 2026. COPE has questioned the contractor’s complete payment despite scant physical work and highlighted possible monthly savings of Rs. 392,904 if certain equipment, such as an incinerator, is shifted to more cost-effective storage. The new terminal is part of a bigger initiative to modernize BIA and enhance passenger operations, ensuring that Sri Lanka’s primary international gateway can accommodate increased travel demand in the years ahead.
