8th Pay Commission update: There is good news for central government employees and pensioners regarding dearness allowance (DA). The All India Industrial Workers Consumer Price Index (AICPI-IW) released for November 2025 has almost confirmed a DA hike. The 12-month average has come very close to the next DA limit, making an increase from January 2026 almost certain.
According to data released by the Ministry of Labor and Employment, the AICPI-IW for November 2025 was recorded at 148.2. This index is directly part of the six-monthly revision process, based on which the official announcement will be made in March-April 2026, but its arrears will be received from January 1, 2026.
Dearness allowance may go above 60%
Based on data up to November 2025, the dearness allowance (DA) as per the Seventh Pay Commission formula has reached 59.93%. This is just below the 60% threshold, and now only the December 2025 data is awaited. Experts believe that a 2% increase is inevitable at the minimum. DA will increase from 58% to 60%. The government only announces DA in absolute numbers, so 60% is almost certain. Given current data and trends, a DA increase is almost certain from January 2026.
If the December 2025 index remains close to November’s, the increase could be even higher. An index reading of 146–147 would result in a DA of approximately 61%, and a reading closer to 148 would result in a DA increase of 62–63%. These estimates are indicative, and the final decision will depend on official December data. According to Manjeet Patel, president of the All India NPS Employees Federation, a DA increase of 3% to 5% cannot be ruled out if inflation persists in December.
The term of the 7th Pay Commission ended on December 31, 2025. The formation of the 8th Pay Commission was notified in November 2025. The Commission is expected to submit its report within 18 months. Only after the new fitment factor is implemented will DA be reduced to zero and merged into the basic pay. All eyes are now on the AICPI-IW data for December 2025, which will provide a clear picture of the final increase.