8th Pay Commission: A 2% rise in dearness allowance (DA) and dearness relief (DR) for central government employees and pensioners is anticipated starting January 2026. This expectation stems from the December 2025 AICPI-IW data released by the Labor Bureau, indicating that the 12-month average has increased to a level where the DA is projected to be around 60%. Currently, the DA stands at 58%, which translates to a direct increase of 2%. However, the final confirmation will only come after the government’s official announcement, which, following tradition, is expected in March 2026 (before Holi).
What is the reason for the 2% increase?
The DA is determined based on the 12-month average of the All India Consumer Price Index (Industrial Workers), or AICPI-IW. In December 2025, the index was recorded at 148.2, with the 12-month average at 145.54. When calculated using the established formula and the base year factor (2.88), the DA was found to be approximately 60.33%. Since the government typically announces DA in rounded figures, it is being considered as 60%. Previously, based on data from June 2025, the government had raised the DA from 55% to 58% in October 2025.
Why will DA still be available after the 7th Pay Commission?
Even though the 7th Pay Commission’s term concluded on December 31, 2025, employees and pensioners will continue to receive DA based on the 7th Pay Commission’s basic pay until the recommendations of the 8th Pay Commission are put into effect. This means that DA will keep increasing, and its advantages will be directly reflected in salaries and pensions. This is why the DA increase in January 2026 is deemed significant for employees.
How much will it affect the salary?
If DA increases from 58% to 60%, there will be a direct benefit to salary. For example, those with a basic salary of Rs 20,000 will see their monthly income increase by approximately Rs 400. Those with a basic salary of Rs 50,000 will receive an increase of Rs 1,000 per month, and those with a basic salary of Rs 1 lakh will receive approximately Rs 2,000 more per month. This means that the higher the basic salary, the greater the benefit. Overall, if the government announces a 2% DA hike, it will prove to be a direct relief for employees and pensioners in this era of inflation.
Sweta Mitra
Working in the media for last 7 years. The journey started in the year 2018. For the past few years, my working experience has been in Bengali media. Currently working at Timesbull.com. Here I write like Business, National, and Utility News. My favorite hobbies are listening to music, traveling, food,...
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