DA Hike Update 2026: Holi, the festival of colors, is bringing double the joy for central government employees and pensioners this time. According to recent reports and Labor Bureau data, the Modi government at the center may formally announce a hike in dearness allowance (DA) just before Holi.
Currently, employees receive dearness allowance at the rate of 58 percent, which is highly likely to be increased by 2 percent to 60 percent. If the government approves this proposal, it will be effective from January 1, 2026, resulting in a significant increase in March salaries.
Why is there only a 2% increase
Employees are wondering why the DA is only increasing by 2 percent this time. In fact, dearness allowance is calculated based on All India Consumer Price Index (AICPI-IW) data up to December 2025. According to data released by the Labor Bureau, the index remained stable at 148.2 points in December 2025, the same as in November.
Based on this stability and the 12-month average, the calculation comes out to be 60.34 percent. Since the government fixes DA in integers, not decimals, it is almost certain to be locked at 60 percent. This is one of the lowest increases in the last seven years, but it is considered logical in an era of stable inflation.
Double Gift in March
Holi is on March 4, 2026 (Wednesday), and it is expected that the Cabinet, chaired by Prime Minister Narendra Modi, will approve this increase in the first week of March. Since this increase will be effective from January, employees will not only receive the increased salary in their salaries around Holi, but the arrears for January and February will also be paid in one lump sum. This large lump sum will provide significant relief to employees and approximately 6.8 million pensioners during the festive season.
How much will the salary impact
A 2 percent increase in DA directly impacts your take-home pay. For example, if an employee’s basic salary is ₹50,000, then at a 58% DA rate, they would receive ₹29,000. At 60%, this amount will increase to ₹30,000, a direct increase of ₹1,000 per month.
Similarly, those with a basic salary of ₹1,00,000 will see their salary increase by ₹2,000 per month. Dearness Relief (DR) for pensioners will also increase proportionately, resulting in a significant increase in their monthly pension.
First change since the 7th Pay Commission
This DA increase is also significant because the formal term of the 7th Pay Commission ended on December 31, 2025. Although the government has not yet made a final decision on the formation or implementation of the 8th Pay Commission, according to current rules, until the new Pay Commission is implemented, the benefits of DA and other allowances will continue to be available on the basic pay structure of the 7th Pay Commission. This is the first DA review of 2026, which will play an important role in determining the fitment factor and new pay scales in the future.
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Vikram Singh
Author at TimesBull covering breaking news and current affairs.
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