Globally, Asia serves as a major manufacturing hub, with countries like India, Vietnam, and China playing significant roles. Sri Lanka’s strategic location positions it as a crucial bridge connecting Asia to the West, facilitating seamless movements and enhancing connectivity between the two regions.

“Strategically positioned at our hub at Sri Lanka’s Bandaranaike International Airport, our airline benefits from access to a vast market of approximately 4.2 billion people within an 8-hour flight radius,” Chaminda Perera, Head of Cargo at SriLankan Airlines, explained.

“This advantageous location, easily accessible by both sea and air, is in close proximity to India and China—two of the world’s largest manufacturing hubs—providing us with a significant growth opportunity.” 

Rebounding market

The Asian market, including Sri Lanka, has experienced considerable volatility despite a consistent upward trend in capacity. Notably, there has been an improvement in volumes entering Sri Lanka following the removal of import restrictions. 

“With the gradual easing of Covid-19 restrictions, there has been a consistent rise in passenger travel demand. As a result, airline schedules have rebounded to more than 95 percent of their pre-2019 levels.

“In terms of total air cargo movements, 65 percent of the cargo is transported using the belly capacity of passenger aircraft. This indicates that the upswing in passenger travel has provided substantial support to airfreight operations. 

Digital drive

SriLankan Cargo has ventured into digital distribution platforms to broaden its market reach, enhance visibility, and boost sales distribution. 

“Transparency is an absolutely essential aspect in the electronic age. The demand for real-time accessibility of information and action has increased,” Perera stated. 

“It is imperative to note that this data is readily available and accessible at the user’s fingertips. Concepts such as digital distribution channels offer customers with real-time forwarding and bookings and responses between the carrier and customers.

“Meanwhile, approvals from authorities and clearance at destinations can be minimised, saving time, by utilising digital communication capabilities.

With the overall industry embrace of technology, SriLankan Cargo has strengthened interline collaborations and expanded trucking partnerships. 

“This move is aimed at extending our reach to areas that might not be efficiently served through direct operations. By leveraging distribution partners and extending services beyond our traditional route network, we are poised to significantly enhance our distribution capabilities,” Perera explained.

Opportunities on the horizon

Since the beginning of the pandemic, there has been a significant surge in e-commerce activity, evolving from a necessity during the pandemic to a lifestyle choice. 

“Retail purchasing is shifting towards digital e-commerce platforms, and effective logistics are crucial for timely and cost-efficient delivery of goods,” Perera highlighted. “In terms of time efficiency, airfreight plays a pivotal role in minimising delivery times. 

“Simultaneously, the pharmaceutical sector has maintained a steady flow of goods, meeting moderate demand levels.”

There is also currently a notable increase in demand for cargo transportation from the Far East to the West, covering Europe and the USA. This surge is largely a result of the Red Sea crisis and congestion in maritime shipping due to container shortages. 

“It is important to note that the duration of this heightened demand, whether it will be short-term or medium-term, is yet to be determined,” Perera noted. 

“Freight operators have been actively responding to this surge by deploying additional capacity to fulfil the increased demands of customers, keeping them busy during this period.

“Our primary concern is the anticipated surge in demand due to the Red Sea crisis, which we view as an opportunity for airfreight services.”