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Sources said Central Public Works Department (CPWD) officials visited sites around the Sanjay Gandhi memorial in the Rashtriya Smriti Sthal and identified some spots where a memorial could come up.
The government is in touch with the former prime minister’s family and has discussed the three or four options for the memorial’s location, they said.
The sources said no site had been finalised yet and everything would be done in consultation with Singh’s family.
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The government has already conveyed its willingness to set up a memorial to the former prime minister’s family.
Singh — the architect of India’s economic reforms — died on December 26 at the age of 92 following age-related complications.
The Congress criticised the government for holding his last rites at Nigambodh Ghat.
The BJP and the Congress also engaged in a bitter war of words over the cremation and the setting up of a memorial.