Figure 10. Transportation System, 1988

In 1987 the road network extended 74,954 kilometers, of which 25,504 were maintained by the Ministry of Highways and the remainder by local governments (see fig. 10). During 1984 the government embarked on a five-year road maintenance program at an estimated cost of Rs5 billion, to be financed by loans from the World Bank (see Glossary) and the Asian Development Bank, together with a grant from Japan. The total number of registered motor vehicles in 1986 was about 478,000.

Road haulage is handled by private companies some businesses also have their own trucking operations. After 1978 container transport became an important mode of freight haulage for exports produced in the investment promotion zones. Intercity haulage is carried out by trucks. Bullock carts remained important in rural and suburban areas in the 1980s.

The Ceylon Transport Board had the sole responsibility for providing public passenger road transport from 1957 to 1978. Fares were heavily subsidized, but overcrowding was severe. In 1978 private buses were again allowed to operate, and the Sri Lanka Transport Board and nine regional transport boards replaced the Ceylon Transport Board. The Sri Lanka Transport Board had responsibility for overall transport policy, budgeting, and production planning, whereas the regional boards were responsible for the operation of regular regional and interregional bus services. In 1986 the revenue-cost ratio of the regional boards was 89 percent. Private road transport expanded rapidly in the late 1970s and early 1980s, but as in the state sector, there was some contraction in the mid-1980s as a result of the declining security in the northern and eastern parts of the country. In 1986 the private sector accounted for about half of the passenger-kilometers. Many buses in both the state and private sectors were in poor condition.

The island's first railroad line, from Colombo to Kandy, was opened in 1867, and in the 1980s Sri Lanka Railways had 1,944 kilometers of railroad track. In early 1988, service in Northern and Eastern provinces had been irregular for several years. The network's passenger-kilometers amounted to 1.9 billion in 1986, about 38 percent less than its total in 1982. Freight services, on the other hand, remained fairly steady in the mid-1980s. The railroads have been operated at a loss since independence.

Three ports can accommodate deep water vessels: Colombo, Trincomalee, and Galle. Colombo was by far the most important. In 1985 it handled nearly 3 million tons of cargo compared with about 600,000 jointly handled by the other two ports. In 1986 the Ceylon Petroleum Corporation began a project to build a single-point buoy mooring 9.6 kilometers offshore from Colombo port. When completed, this project will greatly reduce the costs of discharging crude oil to the refinery near Colombo.

In 1971 Sri Lanka launched93d ed its own merchant fleet. The state-owned Sri Lanka Shipping Corporation purchased its first vessel, a 14,000-ton freighter, in March 1971. By 1981 the corporation owned eight ships, including a 20,000 deadweight ton tanker. In 1987 the firm began to replace its aging fleet.

Colombo is a stopping place on international air routes between Europe and the Asia-Pacific region. The first stage of a redevelopment plan for the Bandaranaike International Airport at Katunayaka was completed in October 1986 with the opening of a new runway, built at a cost of Rs517 million. Some foreign airlines reduced or suspended services in the mid-1980s because of declining traffic due to the security situation.

Air Lanka, the nation's flag carrier, was established in 1980, and in early 1988 it connected Sri Lanka with Europe, the Middle East, and South and Southeast Asia. It was 60 percent government owned. In 1987 a presidential commission set up to inquire into the airline's financial affairs accused former members of the airline's board of subordinating the company's development to their private gain. Taking into account the realizable value of its assets and other costs associated with a forced sale, estimated cumulative losses up to the end of the fiscal year 1986 were Rs7.7 billion, or about Rs1.3 billion for each year of operation. In early 1988, a foreign airline was reportedly being sought to manage Air Lanka and turn it into a viable enterprise.

Data as of October 1988