Government Approves 2% DA Hike for Employees and Pensioners

The central government has approved a 2% increase in the dearness allowance (DA), raising it from 58% to 60%. This decision, effective from January 1, 2026, will benefit approximately 5 million employees and 6.9 million pensioners, providing them with much-needed financial relief amid rising inflation. The DA is designed to protect the income of employees and pensioners from inflation's impact, and this increase follows a previous hike during Diwali. The adjustment is based on the Consumer Price Index for Industrial Workers, ensuring that the financial support keeps pace with living costs.

By Narendra Chaudhary Apr 19, 2026, 00:16 IST

Significant Increase in Dearness Allowance

New Delhi. DA Hike: The central government has approved a 2% increase in the dearness allowance (DA). This adjustment raises the DA from 58% to 60%, benefiting 5 million employees and 6.9 million pensioners.

In a significant move, the central government has granted a 2% increase in the dearness allowance (DA), providing substantial relief to millions of employees and pensioners across the nation. Following this decision, the DA will rise from 58% to 60%. According to Union Minister Ashwini Vaishnaw, this increase will take effect from January 1, 2026, as announced after a cabinet meeting.

Benefits for Millions
This decision will directly benefit millions of individuals in the country. The government's announcement will positively impact approximately 5 million central government employees, along with 6.9 million pensioners and family pensioners. This increase will enhance their monthly income, providing them with financial relief amidst rising inflation. The DA hike will directly increase the monthly salaries and pensions of employees and pensioners covered under the 7th Pay Commission.

Efforts to Mitigate Inflation Impact
The primary aim of the dearness allowance (DA) is to safeguard the income of employees and pensioners from the effects of inflation. It is calculated as a percentage of the basic salary and is revised biannually. The DA is determined based on the Consumer Price Index for Industrial Workers (CPI-IW), which is released monthly by the Labor Bureau under the Ministry of Labor.

Previous Increase During Diwali
Previously, the central government had raised the dearness allowance by 3% during Diwali, increasing it from 55% to 58% in October 2025, effective from July 1, 2025. Employees and pensioners received arrears from this increase, providing them with additional benefits.