Dubai CNN Business  — 

Etihad Airways might be about to double down on a risky investment in India.

Abu Dhabi’s flagship carrier is reportedly looking to increase its stake in cash-strapped Jet Airways, one of the biggest airlines in a market forecast to grow rapidly over the next five years.

According to Indian media reports, Etihad is planning a cash injection to increase its ownership share from 24% to 49%, the most a foreign investor is allowed to hold in an Indian airline.

Etihad declined to comment on the reports.

Jet Airways struggled through 2018 as higher oil prices, a plunge in the rupee and increased competition took a toll on Indian airlines. Its stock fell around 8% on Wednesday.

The carrier said in a stock market filing after the close that it has been “working on various cost cutting measures, debt reduction and funding options” as well as a “comprehensive” turnaround plan.

A decision by Etihad to pump more money into Jet Airways could be risky.

The Indian airline’s stock price has fallen 66% in the past year, and the company acknowledged earlier this month that it had missed debt payments to a consortium of Indian banks because of a “temporary cashflow mismatch.”

“A stake increase would be perhaps surprising,” said John Strickland, an aviation industry consultant at JLS Consulting.

But it would give Etihad a bigger foothold in an aviation market that is forecast to be the world’s third largest by 2024 behind China and the United States.

According to data from India’s Directorate General of Civil Aviation, Jet Airways had over 25 million passengers in the first 11 months of 2018. That was about 17% of all passengers carried by Indian airlines.

If Etihad were to invest more in Jet “it would reflect a wish to protect its investment in the Indian market which is of key strategic importance,” said Strickland.

The United Arab Emirates was the top global destination for passengers flying out of India in the third quarter of 2018, according to the latest Indian government data.

Greater influence over one of India’s top carriers would “give Etihad a significant competitive advantage over its rivals,” said Rob Watts, managing director at global aviation consultancy Aerotask.

Etihad is one of the big three Gulf airlines. It has had its own troubles elsewhere in the world. It reported combined losses of about $3.5 billion for 2016 and 2017 following failed investments in European airlines Alitalia and Air Berlin.

The UAE carrier paid $379 million for 24% of Jet in 2013.

“The challenge for Etihad would be to get the ailing airline back on track,” Watts said, but the potential benefit may be worth it.

“Etihad could be viewing this as an opportunity to boost its equity stake in Jet at a discounted value and take control of an airline that has the potential to turnaround and return a much higher payoff,” he added.