I was trying to do the same for last two days. Went through each and every option available there. But not a single option helped me.
Then I started engineering options in my own way and finally, after hours experiment, results into a charming success. I am here to share the tricks to all of you.
No picture added directly through insert option will be able to change its transparency level. We have to add it using a different route.
1st add a rectangle from Insert --> illustration --> shapes
now right click on it and click on 'Format Shapes'
select the option Fill, then in right side window select Picture or Texture fill. Now through File option select the image you want to have transparency.
say the selected image is
After selecting image, change the transparency level by sliding the bar.
Now see the effect..
Owaooooo.................
