Omkar,
Switching off Logging and debugging will improve performance. However, you will then not have the logs to assist you in troubleshooting problems. When I am working in a support role on a stable production system, I look at these logs maybe once a week. When I am developing new functionality, typically in a development client, I look at them many times each day. You will have to determine if the performance trade-off is worthwhile to you in your business environment.
It is not usually necessary to have detailed logs, nor debugging, turned on in a stable production system. I typically leave the 'standard' logging activated for "*" userid.
Don't forget to maintain the logs periodically. Refer to this document for some general guidelines.
http://service.sap.com/~sapidb/011000358700000715082008E
Best Regards,
DB49
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