Hello Shankar,
I heartily recommend reading Martin Fowler's article,
Cannot Measure Productivity. The
Wikipedia also lists some disadvantages of the traditional LOC metric.
You might also want to take a look at the essay titled "Software Development Productivity" at
www.poppendieck.com/publications.htm for better, alternative measures. These alternative measures are more difficult to calculate, however, which is why we have traditionally resorted to counting lines of code, shutting our eyes from its inherent flaws as a metric for productivity.