New Delhi: India faces a "major challenge" in achieving its 2014-15 fiscal deficit aim of 4.1 percent of gross domestic product, its lowest in seven years, the finance ministry said in a report on Friday.

The report, which was tabled in parliament, also said that a pick up in economic activity was needed to prevent any fiscal slippage in the year to March 2015.

The deficit reached nearly 90 percent of the full-year target between April and October, the first seven months of the current fiscal year.