The Sikkim government has increased the Dearness Allowance (DA) for its employees and Dearness Relief (DR) for pensioners, with the revised rates effective from January 1, according to a Finance Department circular issued on Thursday.
Under the pre-revised basic pay structure, the DA and DR rate has been increased from 257 per cent to 262 per cent. For employees and pensioners covered under the revised pay structure, the rate has been raised from 58 per cent to 60 per cent.
Revised DA Rates for Employees and AIS Officers
The revised rates will also apply to contractual employees and staff working in work-charged establishments who receive pay according to the state’s regular revised pay scales.
The government has separately revised DA for All India Service (AIS) officers. Officers who continue to receive salaries under the Sixth Central Pay Commission’s pre-revised pay band and grade pay system will now receive DA at 262 per cent, compared with 257 per cent earlier.
For AIS officers covered by the revised basic pay structure based on the Seventh Central Pay Commission, the DA has been increased from 58 per cent to 60 per cent, with effect from January 1.
The circular also specifies how revised payments will be rounded off. Amounts of 50 paise or more will be rounded up to the next rupee, while amounts below 50 paise will be ignored.
Sikkim has approximately 50,000 employees and pensioners covered under the state’s rolls.
Central Government Employees Await Next DA Revision
Meanwhile, central government employees and pensioners are awaiting the next revision in their DA and DR as work related to the 8th Pay Commission continues.
The July 2026 revision under the existing 7th Pay Commission framework is expected to increase the DA rate from the current 60 per cent to 63 per cent of basic pay, based on the latest Consumer Price Index for Industrial Workers (CPI-IW) data.
The proposed increase will require approval from the Union Cabinet. If approved, it would be applicable retrospectively from July 1, 2026, meaning employees and pensioners could receive arrears for the period between July and the month in which the revised DA is implemented.
How the 63% DA Estimate Was Calculated
Dearness Allowance for central government employees is revised twice a year, in January and July. The calculation is based on the average CPI-IW data for the preceding 12 months.
With the Labour Bureau releasing the June 2026 CPI-IW figures, the data cycle for the July 2026 revision has been completed. The June index increased by 1.1 points to 151.9, compared with 150.8 in May.
The average CPI-IW for the 12-month period from July 2025 to June 2026 stands at 148.65. Based on the 7th Pay Commission formula, this works out to approximately 63.76 per cent DA.
Since DA is provided in whole percentage points, the expected rate is 63 per cent, representing a three-percentage-point increase from the existing 60 per cent.
Disclaimer
This article is based on the Finance Department circular and CPI-IW information referenced in the report. DA and DR rates, implementation dates and central government pay decisions are subject to official approvals and notifications. Readers should check the latest government orders for confirmation of applicable rates and arrears.