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MCA 21 database and Missing firms
Why is it in the news?
- The Finance Ministry clarified that the ‘missing’ enterprises in the MCA-21 database did not have a significant impact on the calculation of growth rates of GDP and GVA as these companies still added to the total output of the economy.
More in the news
- The National Sample Survey Organisation (NSSO) in a recent survey report on the service sector found that, of a sample of 35,456 companies taken from the MCA-21 database, 38.7% were out-of-survey unit.
- The Finance Ministry explained that of the 38.7% out-of-survey enterprises in the NSSO report, out-of-coverage enterprises comprised 21.4%.
- These out-of-coverage enterprises were those that were not engaged in activities intended for inclusion in the service sector survey.
- As per the Ministry, these enterprises are engaged in some economic activity, possibly in the manufacturing sector for instance.
- The Ministry did acknowledge that the bulk of the remaining 17.3% out-of-survey enterprises were either closed or untraceable.
- Ministry justified this by saying that this proportion was falling over the years and that their impact on the overestimation of GDP “in all likelihood” is marginal.
- MCA 21:(1) MCA21 is an e-Governance initiative of Ministry of Company Affairs (MCA), Government of India.(2) It enables an easy and secure access of the MCA services to the corporate entities, professionals and citizens of India.(3) It enables the business community to register a company and file statutory documents quickly and easily.(4) It provides easy access of public documents.(5) It Helps faster and effective resolution of public grievances.(6) It ensures proactive and effective compliance with relevant laws and corporate governance
Source
The Hindu, Vikaspedia.