Abu Dhabi's Etihad Airways will finalise a deal to buy a stake in India's Jet Airways on Friday, CNBC TV18 reported, in what would be the first such investment by a foreign carrier in an Indian airline since rules were relaxed last year.
A deal may be announced as early as Friday or by the first week of February, the TV channel said, citing unnamed sources.
The Gulf carrier could pay up to U$330m for a 24 percent stake in Jet, India's second-biggest carrier, a senior government source said earlier this month.
Etihad and Jet did not immediately respond to requests for comment.
The Indian government allowed foreign carriers to buy stakes of up to 49 percent in local carriers in September 2012, a move seen as a boon for India's debt-laden airlines.
Jet has previously said it was in talks with Etihad, but the terms of the deal were not finalised.
Etihad and Jet have a code-sharing agreement, and a tie-up could make Jet a more formidable competitor to state-owned Air India, while strengthening Etihad's position against Dubai-based Emirates Airline, which carries a big chunk of the traffic between India and the Middle East.
Jet shares, which have gained 180 percent over the past year on hopes of a potential fund raising, were up 2 percent at INR617.25 on the National Stock Exchange.