The database used by the government called MCA21 has some major loopholes, reported Mint, raising questions over the government's method of calculating GDP.
The report, which points to a study conducted by the National Sample Survey Office (NSSO), found that as much as 36 percent of companies that are part of MCA21 database, could not be traced or were wrongly classified.
“The study has basically revealed that many of the companies which were supposedly active companies and included in the national accounts as such actually either don’t exist or they are misclassified. Only about 54 percent are correctly identified or could be traced or could be found operating units. So, that raises a big question mark on the use of the database as well as the methodology adopted," said Pramit Bhattacharya of Mint.