Jan. 21 (Bloomberg) -- Richard Branson, who controls U.K. carrier Virgin Atlantic Airways Ltd., has sought permission to start a domestic airline in India, where more people have started traveling by air due to economic growth.

Billionaire Branson hopes the Indian government will change its rules on allowing foreigners to run local services, he told reporters in New Delhi today without elaborating.

India's air passenger travel is expanding at about 25 percent a year as economic growth and higher disposable incomes enable more people to shun trains. At least six discount carriers have started flights in the country of 1.1 billion people as air travel growth in India will outpace the global average until 2025, according to government estimates.

Still, India doesn't allow overseas airlines to hold stakes in local carriers directly or indirectly. In 2004, India raised the limit overseas companies, excluding airlines, can own in local airlines to 49 percent from 40 percent to enable them to get more investments.

The policy of not allowing foreign airlines in Indian carriers will be reviewed, Indian government officials have said in the past, without elaborating.

Branson's airline has domestic services in Australia with Virgin Blue, in the U.S. with Virgin America and in Africa with Virgin Nigeria. Virgin Galactic, takes bookings for proposed space flights.

Branson said he would make an announcement on a phone venture in India in a month's time, without elaborating.

To contact the reporter on this story: Kartik Goyal in New Delhi at kgoyal@bloomberg.net.

Last Updated: January 21, 2008 00:45 EST