Dearness Allowance: A component of the basic salary, DA aims to mitigate cost-of-living expenses for central government employees, public sector staff, defence personnel, bank employees, and pensioners. Assam, Arunachal Pradesh, Bihar, Odisha, Tamil Nadu, Uttar Pradesh have announced DA hikes while states including West Bengal and Himachal Pradesh are also considering the same.
As many as 50 lakh central government , including defence personnel, and around 65 lakh retired central government pensioners, including defence retirees benefit from increase in DA and DR component.
DA announcements: Finance Ministry announces 2% hike
Notably, this comes after the Ministry of Finance in April revised and dearness relief (DR) by 2% with effect from 1 January this year. This effectively takes the component up from 58% to 60% of Basic Pay. Revised bi-annually by the All-India Consumer Price Index (AICPI), new DA announcements are made in March and October, followed by rollouts in January and July.
Later in May, the Indian Banks’ Association () announced revised DA and DR for workmen and officer employees across levels for the months of May, June and July 2026. It hiked basic salaries between ₹48,000 to ₹1,17,000 and DA from ₹435 to ₹1,050.
This was followed by a 2% DA and DR hike announced by the . The Railway Board said DA and DR have been revised for lakhs of employees, pensioners, family pensioners, and other eligible beneficiaries covered under the 7th pay commission framework.
Full list of states that announced DA hikes
- has approved a 2-percentage-point increase in DA and DR, up from 58% to 60% with immediate effect, benefitting more than 8 lakh serving state government employees, pensioners, family pensioners, extraordinary pensioners and compassionate family pensioners
- Arunachal Pradesh hiked DA and DR for its employees by 2%, effective from 1 January 2026. DA in basic pay is now up to 60% from 58% and will be implemented for 69,248 regular employees — All India Service Officers serving under the government, central government employees on deputation to the state government, and all regular state government employees.
- Tamil Nadu hiked DA for state government employees, pensioners and teachers by 2%, effective from 1 January 2026, taking allocation to 60% of basic salary. The state will bear additional annual expenditure of ₹1,230 crore. As many as 16 lakh state government employees, teachers, individual pensioners, and family pensioners will benefit from this DA hike, as per the official state government release.
- Bihar also announced that employees and pensioners under the 6th Pay Commission will get a 5-percentage-point hike in DA and DR, i.e. DA will be raised from 257% to 262%, effective from 1 January. For employees under the 5th CPC, DA has been increased by 9 percentage points, from 474%to 483%, and for those under the 7th CPC, it has been raised from 58% to 60%.
- announced a 2% increase in DA for state government employees and pensioners, up from 58% to 60%, effective from 1 January, as per a statement from the Chief Minister’s Office (CMO). It added that this would be paid along with the May salary. Alongside this, the temporary increase (TI) for pensioners was also raised by 2% and will be reflected in the May pension. Around 8.5 lakh state government employees and pensioners are expected to benefit from the announcement.
- Uttar Pradesh on 21 May, announced a 2% hike in DA and DR for state government employees and pensioners, effective from 1 January. This increases the DA component of staff compensation to 60% of basic pay from 58% and will benefit around 16 lakh government employees, teachers, and pensioners.
- approved payment of ₹800 crore DA arrears for state government employees under the 5th, 6th and 7th central pay commissions for November and December 2025 and January 2026. It also approved 2% increase in DR for retired All India Services officers.
List of states considering DA hikes: Check details
- government on 30 May said it will consider payment of pending DA and DR dues to state government employees (across categories) and pensioners for the period between 1 July 2021 to 31 March 2024. It added that a sub-committee will discuss payment of arrears for employees and pensioners based on revised salary and pension benefits for the period between 1 January 2016 to 30 June 2021.
- The Chief Minister Suvendu Adhikari has confirmed that the DA announcement for government employees and pensioners will be made in the next state Budget. On the 7th state pay commission, he added that DA arrears between 2016 and 2019 have been paid to nearly 3 lakh employees and pensioners, the report added. Earlier he assured that the state will implement the Supreme Court’s order on payment of DA dues.
- Himachal Pradesh government is reviewing DA and pending arrears for state employees and pensioners, Chief Minister Sukhvinder Singh said. The Finance Department has been directed to withdraw its notice regarding the deferment of salaries and release the pending pension arrears. Sukhu called government employees the backbone of the state, and said the government remained committed to safeguarding their welfare and interests.
Is a DA hike likely in July 2026?
According to government data, in April 2026 rose to 3.48%, while food inflation climbed to 4.20%. Rising food (milk, vegetables and other essentials), power and fuel (CNG, diesel and petrol) prices are putting pressure on household budgets, and an adjustment in DA would significantly help address inflation concerns for burdened middle-class households, lower-income groups and daily commuters.
While there is no official word yet, the debate over a higher DA revision has gained momentum. Employees and are increasingly looking forward to a 2-3% hike in July.
Disclaimer: This story is for educational purposes only. The views and recommendations made above are those of individual analysts or broking companies, and not of Mint. We advise investors to check with certified experts before making any investment decisions.