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The government revise the DA twice in January and again in July, although official announcements are often later occurred later. While the January amendment is usually declared around Holi to provide financial relief before the festival, the July amendment is declared near Diwali in October or November.
The government adjusts these allowances to mold employees and pensioners with inflation on their purchasing power.
How much increase is expected this time?
According to December 2024 data, DA is estimated to have a 2% increase, which will probably put DA and DR at 55%.
However, the final decision will depend on the approval of the Union Cabinet under the leadership of the Prime Minister.
How is DA calculated?
The DA rate is calculated on the basis of the All India Consumer Price Index for industrial workers (AICPI-IW) compiled by Labor Bureau in Shimla. For central government employees, DA is calculated using the following formula:
DA (%) = ((average for the last 12 months average year 2001 = 100) – 115.76) / 115.76) x 100
For public sector employees, the formula used is:
DA (%) = ((average for the last 3 months average year 2016 = 100) – 126.33) / 126.33) x 100
Previous da hike
On March 7, 2024, the cabinet increased the DA to 50% of the original salary at the previous rate of 46%. The announcement was made a few days before Holi on 25 March, 2024.
Subsequently, the cabinet approved another 3% increase in DA for central government employees and DR for pensioners under the 7th Pay Commission. With this increase, both DA and DR increased to 53%. These revised DA and DR were scheduled to be effective from July 1, 2024.
What is next and 8th pay commission
With the 8th Pay Commission prescribed for implementation in 2026, many people are wondering whether the DA will be resetted and merged into the basic salary.
Given the current progress of the Commission, its recommendations are expected to be finalized by the end of the ongoing financial year and can be implemented in the next financial year.
Prior to that infection, there will be a possibility of three and DA hike under the 7th Pay Commission – two in 2025 and one in 2026.
Read more here: 8th Pay Commission Approved: How many employees and pensioners will benefit
first published: March 6, 2025 10:10 AM First
News (T) AicPI-IW DA Count (T) DA Hike Approve by Union Cabinet
