The national carrier Air India is mulling an all-women crew flight.
The stake-purchase agreement with Jet, second largest domestic passenger market share, will make Etihad the first foreign carrier to buy into an Indian airline.
Jet's flights to Abu Dhabi could be used to carry passengers from India headed for the US and Europe.
The two parties have been in talks for a month and a half.
Sources close to the deal say, besides a higher stake (earlier, the negotiations were on for sale of up to 24 per cent), Etihad has asked for its representation on the board of the Indian airline, in sync with its shareholding.
Barely a fortnight after it launched international operations and integrated low-cost carrier Simplify Deccan with it, Vijay Mallya-promoted Kingfisher Airlines plans to lay off at least 300 employees, official orders for which are to be conveyed on Monday.
Jet is believed to be in talks with leading private equity players.
Cash-strapped Indian carriers are finally finding money to finance expansion plans or merely fund operations. State-owned Air India is set to receive a $1 billion (Rs 49,000 crore) loan and Naresh Goyal-promoted Jet Airways is close to striking a deal for a Rs 500-crore loan from Indian Overseas Bank.
The airline has also finalised its plans to lease out five of its Boeing 777-300 ER aircraft to a Turkish carrier, sources add. The airline has been able to negotiate a premium for the deal in a market where lease premiums have dropped.Domestic carriers are facing turbulent times because of the high crude prices and variable taxation on the air turbine fuel. The problem is now compounded because of a slump in the economy now.
Aiming at 50 per cent revenue from its international operations in three years, Naresh Goyal-promoted Jet Airways is planning to launch flights to New York in August followed by San Francisco and Toronto.
Jet will have 56 flights (around 9,400 seats a week) from four destinations from New Delhi, Mumbai, Kochi and Kozhikode to Bahrain and Doha (non-stop), Muscat and Kuwait, and cater to the middle and upper ends of the market.
Jet Airways was granted traffic rights on the Gulf and West Asian routes at a meeting of the Directorate General of Civil Aviation on Thursday evening.
The top-level exodus at Naresh Goyal-promoted Jet Airways continued on Friday, with chief financial officer and acting CEO Ravishankar Gopalakrishnan quitting.
would also take on board its strategic investment partner Etihad
The airline has paid the TDS but mostly after the scheduled date.
The ministry of corporate affairs has raised questions on Etihad's rights to nominate three directors on the board and, despite being a minority shareholder in the company, decide on the vice-chairman.
The next FIPB meeting slated for July 5, however, does not have a Jet proposal on its agenda.
Private airlines Jet Airways and IndiGo joined the race for low-fares, offering their customers hefty discounts, after Air India rolled out a similar offer to challenge Vistara, the latest full-service entrant in the domestic market.
It offers fares as low as Rs 1,499 for a one-way journey.
The Indian government allowed foreign airlines to buy up to 49 per cent stakes in Indian carriers in September 2012.
The Boeing website lists the price of a Boeing 737-800 aircraft at $90.5 million.
National carrier Air India became part of the 27-member global airlines grouping Star Alliance, as budget airline AirAsia India launched operations and Tata-SIA joint venture carrier Vistara received the flying permit and announced its intentions to start operations from January 9.
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