DA news: What are the types of dearness allowance, how is it calculated and revised? Here are top FAQs answered
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- ✓The Finance Ministry in April announced a DA hike of 2% for all central government employees and pensioners, effective from 1 January 2026.
- ✓This revision increased the component to 60% of basic pay.
- ✓Officials use the All-India Consumer Price Index to calculate these hikes, helping staff manage rising living costs.
Story at a Glance
- Category
- MARKET
- Reported By
- mint
- Reading Speed
- 3 Minute(s)
- Market Focus
- India Economy
Revised twice annually based on data from the All-India Consumer Price Index (AICPI), Dearness Allowance (DA) is a percentage of employees' basic salary aimed at mitigating cost-of-living impact on households of central government employees. A DA hike gives employees a higher in-hand salary and a buffer against inflation.
New announcements are usually made in March and October, with rollouts in July and January. Notably, this year, the Finance Ministry in April announced DA hike of 2% for all central government employees and pensioners (including railways and defence personnel), effective from 1 January 2026. This increased the component to 60% of basic pay from 58%.What are the types of Dearness Allowance?
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