That will fail to convert CR LF to LF even though :crlf is used, and it will corrupt a number of character combinations. (Specifically, the character U+0A0D and pairs of the form U+0Dxx U+xx0A.)

Fix if you want CR LF ⇒ LF conversion:

open my $fh, '<:raw:perlio:encoding(UTF-16LE):crlf', $filename
    or die "Couldn't read '$filename': $! / $^E";
[download]

Fix if you want to leave CR LF intact:

open my $fh, '<:raw:perlio:encoding(UTF-16LE)', $filename
    or die "Couldn't read '$filename': $! / $^E";
[download]

(Mind you, corruption is very unlikely to occur since you'd have to be dealing with Malayalam characters. The non-functioning :crlf layer a more likely problem.)

It's unfortunate that one has to go through these shenanigans when dealing with non-ASCII encodings.