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Etihad Airways has won clearance to double its 4.99% shareholding in Virgin Australia.

The UAE carrier welcomed the decision by the Australian government to allow it to raise its equity stake in Virgin Australia to a maximum of 10%.

The strategic partnership has already delivered unspecified “significant revenues” to each airline. It is expected that the equity stake in Virgin Australia will lead to further revenue generating opportunities, Etihad Airways said.

Etihad Airways took its initial stake earlier this year following the development of a partnership between the two airlines covering flight code-shares, joint marketing initiatives and reciprocal rewards on their respective frequent flier programmes.

The two carriers currently operate 24 flights a week between Australia and Abu Dhabi offering passengers a combined network of more than 285 global destinations.

Etihad Airways, which serves Sydney, Brisbane and Melbourne and is to start Perth flights, also holds equity stakes in Airberlin, Air Seychelles and Aer Lingus.

It is estimated that Etihad Airways' passengers have spent more than A$1.5 billion locally on hotels, tours, restaurants, retail shopping and other tourist activities in Australia.

The airline's aircraft, office, marketing and selling costs have directly contributed more than A$540 million to Australia’s GDP.

Etihad Airways has three regional offices and a line maintenance facility in Australia, and employs more than 300 Australian members of staff who are based in Australia, Abu Dhabi and at stations around the world.

“Etihad Airways is very proud to have been, and continues to be, a good friend to Australia. At the same time, Australia has been a great success for Etihad Airways,” the airline said.

“We look forward to building on this long and prosperous re