C Rangarajan, the chairman of the Prime Minister's Economic Advisory Council (PMEAC) has said that the central government is not likely to achieve its 4.6% fiscal deficit target for the financial year.

While deceiving a lecture on 'The Indian Economy: Concerns and Prospects' on the ASSOCHAM Foundation Day, he said that it might be difficult to achieve. He added that the it is important that deficit remains close to this level to maintain credibility.

Rangrajan said that the government is required to form proper road map to reach the Fiscal Responsibility and Budget Management target of 3% of GDP. "We must focus particularly on reducing the overall level of subsidies as a proportion of GDP," he said.

Finance minister Pranab Mukherjee had already stated that it would be very difficult for the government to achieve the target in the financial year. Mukherjee said that the coming few months would 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.