Updated biannually using data from the All-India Consumer Price Index (AICPI), dearness allowance (DA) is a percentage of employees’ basic pay that aims to mitigate the inflation impact and rising cost of living.
New announcements usually come in March and October, with rollouts in January and July. The last hike was announced in April this year, when the Finance Ministry increased of basic salary, effective from 1 January 2026.
Over 1 crore beneficiaries, comprising some 50 lakh central government employees and about 65 lakh pensioners, including defence and railway personnel and retirees, gain from an increase in DA and (DR), respectively.
DA hikes announced by states so far — Full list
Following the Finance Ministry’s announcement, the Indian Banks’ Association (IBA) announced revised 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. Later, the Indian Railways also announced a 2% hike in DA and DR for staff and pensioners.
Here’s a look at the full list of DA hikes announced by states so far:
- Andhra Pradesh this month approved two long-pending DA revisions — giving a combined of 4.55% DA hike for state government employees, local body personnel and university staff. It will be implemented from September 2026 and disbursed with salary released in October this year. The first installment of 2.73% hike, which takes DA from 37.31% to 40.04% of basic pay comes retroactively in effect from July 2024; and the second of 1.82%, takes DA from 40.04% to 41.86% of basic pay comes retroactively in effect from January 2025. The arrears will be released in structured installments in 2027 and 2028 salaries.
- 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.
- In May, Assam 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.
- Bihar also announced that employees and pensioners under the 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%.
- Maharashtra 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.
- Odisha 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). Around 8.5 lakh state government employees and are expected to benefit from the announcement.
- Sikkim in August announced that the state government is hiking DA and DR by 2% each, applicable from 1 January 2026.
- 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.
- Uttar Pradesh on 21 May, announced a and DR for state government employees and pensioners, effective from 1 January — up to 60% of basic pay from 58% and will benefit around 16 lakh Uttar Pradesh government employees, teachers, and pensioners.
- The West Bengal government in June hiked DA and DR for state government employees and pensioners by 20%, with effect from October, taking the component to 38% of basic salary. According to the notification, those employees still drawing under the 5th CPC will get DA at 223%, up from the existing 171%, from 1 October. Further, pensioners and family pensioners whose pensions are yet to be revised under the Revision of Pay and Allowances (ROPA) 2009 rules will also receive DR at 223% until their revised pensions are implemented, it added.
Why is DA hike important?
DA is a component of the salary break-up for central and public sector employees, aimed at mitigating the rising cost of living. Notably, the basic salary also determines other components of compensation, such as provident fund contributions, pension, allowances, gratuity, and more.
Thus, higher DA, especially given demands, could lead to a substantial and automatic increase in overall pay and, consequently, in the other dependent allocations. Notably, employees and pensioners are expecting another hike from the Centre during Diwali year.
Meanwhile, DA revision is under discussion by the 8th central pay commission (CPC), which is expected to submit its final recommendations around 18 months after its constitution, latest by May 2027.