I checked w/ the DC office of the TRAVISA services, they responded that you could write a cover note w/ your visa application mentioning that your passport is with the Embassy for OCI processing and also attach a copy. They will cancel the passport when the OCI processing is over, presumably that's why they need it for the Visa processing too.
Folks, you have all been so kind enough to respond.
I have one more question. When I apply for OCI, they have requested to send my indian passport in original. If I send the original indian passport for OCI and then I need to travel while OCI is in process, I would need to apply for an Indian visitor visa. There they say "Applicants born in India applying for the first time on ANY U.S. passport must submit their Indian passport and a completed renunciation form ". But I wont have the original indian passport. So what could I do? Any ideas.
Thanks for your answers.