The central government will struggle to meet its deficit target of 4.6 percent for the financial year till March 2012.

Finance minister Pranab Mukherjee has said that it is a major challenge for the government to meet its deficit target for the year. He said that the government expects the inflation to fall to between 6 percent and 7 percent by the end of March.

India's headline inflation fell to 7.47 per cent, it's lowest in two years, in the month of December 2011, backed by the cheaper prices of food items in the country.

India's inflation, which is based on Whole Sale Price Index (WPI), was recorded at the level of 9.11 per cent recorded in November. The inflation was recorded at the level of 9.45 percent in December of 2010.

Mukherjee said that the coming few months will be difficult for the government that is trying to stay within target deficit level .Experts say that the government is likely to miss its target of reducing the budget deficit to 4.6 percent of gross domestic product one or two points in the current fiscal year.

The deficit was recorded at the level of 6.7 percent of GDP in the first half of 2011-12 and is expected to be between 6 and seven percent in the current financial year. The situation has worsened due to slowdown in the growth of tax revenues and high import bills due to the falling value of the rupee.

"Adhering to the fiscal deficit target of 4.6 percent of gross domestic product in 2011-12 is a major challenge," Mukherjee said.