An aviation committee recommended the full transfer of Sahara Airlines' assets to India's largest domestic carrier Jet Airways including parking bays and landing slots, according to the Press Trust of India quoting sources.

The deal was struck in January but talks had reportedly been stuck over whether the government would approve the transfer.

Saroj Datta, executive director of Jet Airways, declined to comment on the reports. "We have received no official communication," he said in Mumbai.

The decision still needs to be approved by the Indian Government, along with new guidelines on mergers between airlines, according to PTI. They are expected next week.

Merger talks between executives of the two airlines, to create a company with almost half the domestic market, were extended for another three months earlier this week.

Consolidation is expected in the booming Indian airline industry with domestic passengers tipped to increase from some 25 million a year to about 50-60 million by 2010.

A merged entity will increase the competition for carriers like state-run Indian and private-sector Kingfisher Airlines, as well as budget carriers like SpiceJet, Air Deccan and GoAir.