DA Hike July 2026: Centre Announces 3% Increase In Dearness Allowance For Govt Employees, Pensioners Ahead Of Diwali

Last Updated:October 28, 2026, 4:00 PM IST

DA Hike July 2026: The combined annual impact of the DA and DR revision on the government exchequer is estimated at Rs 10,016 crore.

DA Hike July 2026.

DA Hike July 2026: The Centre has approved a 3-percentage-point increase in Dearness Allowance (DA) for central government employees and Dearness Relief (DR) for pensioners, taking the rate from 60% to 63% of basic pay under the 7th Pay Commission. The revised rates will be effective from July 1, 2026, offering a festive-season boost to government employees and pensioners.

The combined annual impact of the DA and DR revision on the government exchequer is estimated at Rs 10,016 crore.

Union Minister Ashwini Vaishnaw announced the decision after the Union Cabinet meeting on Wednesday, October 28.

The revision will benefit abut 48 lakh central government employees and 68 lakh pensioners.

In the previous DA hike in April, the central government had increased DA and DR by 2 per cent to 60% of basic pay and pension.

DA Hike 2026: How Much Will Your Salary Increase?

The financial benefit of a 3-percentage-point increase in DA can be calculated by applying the additional 3% to an employee’s basic pay. For example, an employee with a basic salary of Rs 30,000 will receive an additional Rs 900 per month. At a basic salary of Rs 40,000, the monthly increase will be Rs 1,200.

Here’s how the increase works at different basic pay levels, assuming the DA rate rises from 60% to 63%:

How Is The 3% DA Hike Calculated?

Dearness Allowance is calculated as a percentage of basic pay. Therefore, a 3-percentage-point increase in the DA rate translates into an additional amount equal to 3% of basic pay.

The formula is:

Monthly increase in DA = Basic pay × 3 ÷ 100

For an employee drawing a basic salary of ₹18,000, the calculation would be:

• Basic pay: Rs 18,000
• Existing DA at 60%: Rs 10,800
• Revised DA at 63%: Rs 11,340
• Additional monthly DA: Rs 540
• Additional DA over 12 months: Rs 6,480

Similarly, an employee with a basic salary of Rs 56,100 would receive an additional Rs 1,683 per month, equivalent to Rs 20,196 over 12 months if the revised rate applied throughout the year.

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What is the new Dearness Allowance rate for central government employees in July 2026?

The Centre approved a 3-percentage-point increase in Dearness Allowance (DA) and Dearness Relief (DR), raising the rate from 60% to 63% of basic pay under the 7th Pay Commission framework effective from July 1, 2026.

When was the July 2026 DA hike officially announced and who will benefit from it?

Union Minister Ashwini Vaishnaw announced the decision on Wednesday, October 28, following a Union Cabinet meeting. The revision will benefit approximately 48 lakh central government employees and 68 lakh pensioners.

What is the estimated financial impact of the 2026 DA and DR revision on the government exchequer?

The combined annual financial impact of the Dearness Allowance and Dearness Relief revision on the government exchequer is estimated at Rs 10,016 crore.

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Mohammad HarisDeputy News Editor (Business)

Haris is Deputy News Editor (Business) at news18.com. He writes on various issues related to personal finance, markets, economy and companies. Having over a decade of experience in financial journalis…Read More

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