7th Pay Commission – DA Hike in July 2025: The central government had increased the Dearness Allowances of government employees by 2% for January-June 2025, which is considered to be the lowest increase in about 78 months. After this increase, the DA of Central Government Employees has currently increased to 55%.

Dearness Allowance is given to government employees and pensioners to provide relief from the effects of inflation and it is revised twice a year, once for January-June and second time for July-December. Usually the government announces it in March and then in October or November.

After a marginal increase of just 2% for January-June, now more than 1.2 crore central employees and pensioners are hoping that this time there will be a good increase in DA for July-December. The special thing is that this will be the last scheduled DA revision under the 7th Pay Commission as its term will end on 31 December 2025.

After this, the recommendations of the 8th Pay Commission are to be implemented. However, looking at the current situation, it is very unlikely that the recommendations of the 8th Pay Commission will be implemented from January 2026. At present, it seems that the wait for this may be long.

The annual inflation rate in March was 2.95%, which is slightly higher than February. The prices of food items did not increase much, due to which a slight positive movement was seen in CPI-IW.

 

How is DA calculated?

According to the 7th Pay Commission, DA calculation is based on the average of CPI-IW of the last 12 months. Its formula is:

 

DA (%) = [(12-month CPI-IW average) – 261.42] ÷ 261.42 × 100

 

At present, DA has become 55% from January 2025. Now the CPI-IW figures to be released for April, May and June 2025 will decide how much increase will be there in July.

 

How much can DA increase in July 2025?

According to the average data till March 2025, the estimated percentage of DA has reached 57.06%. If there is a slight increase in CPI-IW in the next three months, then this average can go up to 57.86%. If this happens, then DA can go directly to 58% after rounding. But if the average remains less than 57.50%, then DA can stop at 57% only. That is, looking at the current trend, the expectation of an increase of 2% to 3% is considered strong.