COLOMBO: Sri Lanka has restored an online visa application platform to encourage tourism after its top court suspended a controversial multimillion-dollar deal that outsourced visa processing to a foreign consortium.

The government of newly elected President Anura Kumara Dissanayake said late Thursday that the move was intended to promote the island nation’s key tourism sector, as its economy limps out of the 2022 financial crisis.

Tourists will now be able to apply for a visa online without paying the $25 charged by India-based VFS Global, which won an outsourcing contract in April from the previous government.

Rights activists had alleged in court that the contract was not awarded transparently and said the consortium stood to earn up to $2.75 billion over a 16-year period.

Sri Lanka’s Supreme Court in August ordered immigration authorities to revert to the online platform that was used prior to the award to VFS.

“The visa facility provided by the VFS Global has caused significant difficulties for many,” Dissanayake’s office said in a statement Thursday, adding that foreigners had faced challenges obtaining visas.

On Wednesday, immigration chief Harsha Ilukpitiya was arrested for failing to heed the Supreme Court’s decision.

Ilukpitiya had awarded the multimillion-dollar contract to India’s GBS Technology Services and IVS Global FZCO, along with VFS Global as a partner, to process visa applications from April.

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“We have initiated an immediate forensic audit to investigate the irregularities associated with the VFS Global,” the president’s office said Thursday.

“Any discrepancies found will be subject to legal action.”

AFP has contacted VFS in Sri Lanka for comment.

Under the outsourcing deal, any foreigner entering Sri Lanka was required to pay a $25 visa processing fee – even citizens of countries that had visa-free travel arrangements with Sri Lanka.

About 1.19 million tourists came to the island in the first seven months of this year, up 56 percent from the same period in 2023, according to central bank data.