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With three days remaining of this parliament session, Modi may rely on an order to lift the caps on foreign investment in the insurance sector to 49 percent and renew another order opening up the coal industry to the private sector, according to two government officials.
Any changes will need to be approved by lawmakers within six weeks of the opening of the next session of parliament - scheduled for the beginning of February. India's president must also agree to these decrees which are meant to be rarely used.
"The route is always available but we are yet to decide," said one official, who is not authorised to discuss the matter publicly.
"We will take a call after seeing what happens in the remaining part of the session."
Modi, who was elected in May with a mandate to provide jobs and economic growth, has seen his reform agenda stymied by controversial statements by lawmakers in his Hindu nationalist party.
Opposition parties have been protesting for more than a week after a Hindu priest-turned-lawmaker in Modi's party said he planned to support an event to covert thousands of Christians in the northern state of Uttar Pradesh on Christmas Day.
Even though the ceremony was cancelled this week the opposition has been pressuring the prime minister to make a statement on it in parliament.
A bill to lift the caps on foreign investment has been languishing in parliament for more than six years. Its passage would allow global insurers such as American International Group to raise its stake in an Indian joint venture.
The government is also looking to enact proposals passed in October by an executive order to auction coal mines and allow private firms to mine and sell the fuel for the first time in 42 years. Unless enacted, the order will lapse on Jan. 6.
The reforms in the coal and insurance sectors were expected to be passed in this session of parliament because they enjoy rare bipartisan support. Modi's failure to pass them could undermine investor confidence.
"If the bills are not passed it will show badly on Modi's resolve on reforms," said U.R. Bhat, managing director at Dalton Capital, a unit of British-based investment management firm Dalton Strategic Partnership LLP that manages nearly $2 billion in assets.
