Dearness Allowance (DA) remains an important source of financial support for government employees as living costs continue to rise. Under the 7th Central Pay Commission (CPC) framework, the central government revises DA twice a year based on the All-India Consumer Price Index (AICPI). These revisions benefit more than one crore employees and pensioners, including approximately 50 lakh central government employees and nearly 65 lakh pensioners, defence personnel, railway staff and retirees covered by the applicable arrangements.
DA is calculated as a percentage of an employee’s basic salary to help offset the impact of inflation. Dearness Relief (DR) serves a similar purpose for eligible pensioners.
Central government DA announcements generally take place around March and October, with revisions typically effective from January and July. The previous increase mentioned in the supplied information was announced in April 2026, when the Finance Ministry raised DA from 58% to 60% of basic pay, effective from January 1, 2026.
Meanwhile, the 8th Pay Commission is also examining pay-related matters, including DA revision. It is expected to submit its final recommendations within approximately 18 months of its constitution, with May 2027 cited as the latest expected deadline.
DA Hike 2026: Updates for Banks and Railways
Following the Finance Ministry’s announcement, the Indian Banks’ Association (IBA) announced revised DA and DR for bank workmen and officers across different employee categories for May, June and July 2026. The announcement covered basic salary figures ranging from ₹48,000 to ₹1,17,000 and DA amounts ranging from ₹435 to ₹1,050.
Indian Railways subsequently announced a 2% increase in DA and DR for its employees and pensioners.
Several state governments have also announced changes to DA, DR or arrears during 2026. The key updates are outlined below.
State-Wise DA Hike List 2026
Kerala
Kerala increased DA and DR by two percentage points, taking the rate from 35% to 37%. The revised amount is scheduled to be paid with the October 2026 salary, which will be disbursed in November.
The increase covers state government employees, teachers, full-time contingent employees and local government staff. Eligible state service pensioners, family pensioners, ex-gratia pensioners and their families are also included.
This follows an earlier increase in February 2026, when DA and DR rose from 25% to 35%.
Telangana
Telangana announced two DA and DR instalments for state government employees and pensioners across different categories. The revisions are 3.64% and 2.73%, respectively, and are scheduled to be paid with the October salary, due on November 1, 2026.
The payment represents a partial settlement of the 15.43% in DA instalments that had remained pending since the previous Bharat Rashtra Samithi government.
Sikkim
Sikkim announced a 2% increase in DA and DR under the 7th CPC framework in August, raising the rates from 58% to 60%. On October 1, the state also announced a 5% increase under the 6th CPC, taking the rate from 257% to 262%.
Both revisions are effective from January 1, 2026. Approximately 50,000 state employees and pensioners are covered by the state’s workforce and pension system.
Punjab
Punjab notified an 8% DA increase for state government employees and pensioners, effective September 1, according to a PTI report.
A statement from the Chief Minister’s Office said the increase would provide additional financial support amid rising household expenses and the cost of essential goods.
The increase will be released in two instalments of 4% each, with the revised benefit scheduled to appear in salaries from October.
Andhra Pradesh
Andhra Pradesh approved two pending DA revisions, providing a combined increase of 4.55% for state government employees, local body personnel and university staff. The changes are scheduled for implementation from September 2026, with payment alongside the salary released in October.
The first instalment increases DA by 2.73%, from 37.31% to 40.04% of basic pay, with retrospective effect from July 2024.
The second instalment adds 1.82%, raising DA from 40.04% to 41.86% of basic pay, effective retrospectively from January 2025.
The government will release the accumulated arrears in instalments through salaries paid in 2027 and 2028.
Arunachal Pradesh
Arunachal Pradesh raised DA and DR by 2%, effective January 1, 2026. For employees covered by the revision, DA has increased from 58% to 60% of basic pay.
The increase is set to benefit 69,248 regular employees.
Assam
In May, Assam approved a two-percentage-point increase in DA and DR, raising the rates from 58% to 60% with immediate effect.
The decision is expected to benefit more than eight lakh serving state government employees and pensioners.
Bihar
Bihar announced different DA revisions for employees and pensioners covered by the 5th, 6th and 7th Pay Commission frameworks.
Under the 6th CPC, DA and DR increased by five percentage points, from 257% to 262%, effective January 1.
For employees covered by the 5th CPC, DA increased by nine percentage points, from 474% to 483%.
Under the 7th CPC, the DA rate was raised from 58% to 60%.
Maharashtra
Maharashtra approved the release of ₹800 crore in DA arrears for state government employees covered by the 5th, 6th and 7th Central Pay Commission frameworks. The arrears relate to November and December 2025 and January 2026.
The state also approved a 2% increase in Dearness Relief for retired All India Services officers.
Odisha
Odisha announced a 2% increase in DA for state government employees and pensioners, taking the rate from 58% to 60%, effective January 1, 2026.
According to a statement from the Chief Minister’s Office, approximately 8.5 lakh state government employees and pensioners are expected to benefit.
Tamil Nadu
Tamil Nadu raised DA by 2% for state government employees, pensioners and teachers, effective January 1, 2026. The revised rate stands at 60% of basic salary.
The increase is expected to result in an additional annual expenditure of ₹1,230 crore for the state government.
Uttar Pradesh
On May 21, Uttar Pradesh announced a 2% increase in DA and DR for state government employees and pensioners, effective January 1, 2026.
The revision raised the rate from 58% to 60% of basic pay and is expected to benefit approximately 16 lakh government employees, teachers and pensioners.
West Bengal
In June, West Bengal announced a 20% increase in DA and DR for state government employees and pensioners, effective October. The revision takes the applicable component to 38% of basic salary.
According to the notification, employees who continue to receive salaries under the 5th CPC will receive DA at 223% from October 1, compared with the previous rate of 171%.
The notification also states that pensioners and family pensioners whose pensions have not yet been revised under the Revision of Pay and Allowances (ROPA) 2009 rules will receive DR at 223% until their revised pensions are implemented.
Disclaimer
This article is intended for general informational purposes only and summarises the DA and DR announcements described in the information provided. Rates, effective dates, payment schedules, eligibility conditions and arrears arrangements may vary by state, employee category and applicable pay commission. Readers should verify the latest official government orders and notifications before relying on any figures or payment dates. The article does not constitute financial, employment or legal advice.