Civil aviation secretary on Friday said it was not possible for a foreign airline to fully own an Indian carrier, but will examine whether it can be done through an investment partner.
Rajiv Nayan Choubey also said the government had not received any proposal from Qatar Airways to start a local airline.
Last week, Qatar Airways Chief Executive Akbar Al Baker said he wanted to set up a full service Indian carrier to fly domestic routes with around 100 narrowbody planes, now that the country has opened up the airline industry to foreign investors.
Under current rules, foreign airlines are still restricted to holding a maximum stake of 49 per cent in Indian carriers, but other foreign investors may own up to 100 per cent.