Finally I got the solution. Bootstrapper UI for language selection can be created as described here. After that, I wrote following code in my button click event to launch the msi in selected language:
Bootstrapper.Engine.StringVariables["CommandArgs"] = ":1031";
Bootstrapper.Engine.Plan(Wix.LaunchAction.Install);
break;
....
....
this.Close(); //outside of switch statement
break;
The above code will use CommandArgs as an MSI property.Then I added following code to my bundle.wxs file
<MsiPackage Id="mypackage" SourceFile="myinstaller.msi" DisplayInternalUI="yes">
<MsiProperty Name="TRANSFORMS" Value="[CommandArgs]"/>
</MsiPackage>
Worked exaclty the way I wanted. This code is same as launching msi from command line using following command
msiexec /i myinstaller.msi TRANSFORMS=":1031"
The only issue is that it is taking some time to launch MSI after language is selected from above UI.