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Central Govt Employees Likely To Get 2% DA Hike Soon; Salary To Rise From January 2026
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The All-India Consumer Price Index for Industrial Workers rose by 0.5 points to 148.2, keeping the 12-month average firmly on track to take DA/DR to 60%, from 58% currently.
January 2026 DA Hike.
DA Hike January 2026, DA Hike Latest News: Central government employees and pensioners are set for a 2 percentage point hike in dearness allowance (DA) and dearness relief (DR) from January 1, 2026, with the latest inflation data pointing to the 60% DA/DR level under the 7th Central Pay Commission (CPC).
The trigger is the All-India Consumer Price Index for Industrial Workers (AICPI-IW) for November 2025, released by the Labour Bureau under the Ministry of Labour & Employment on December 31, 2025. The index rose by 0.5 points to 148.2, keeping the 12-month average firmly on track to take DA/DR to 60%.
November AICPI-IW confirms 60% DA trajectory
As per the standard DA formula used for the 7th Central Pay Commission, the rolling 12-month average of AICPI-IW (base year 2016=100) is used to compute the percentage increase over the base index of 261.42. With November’s reading, the calculated DA has reached 59.93%, effectively at the doorstep of 60%.
Month-wise calculations show a steady climb:
- July 2025: 58.53%
- August 2025: 58.94%
- September 2025: 59.29%
- October 2025: 59.58%
- November 2025: 59.93%
Only the December 2025 index reading remains, but scenario analysis indicates that the outcome is now largely locked in.
December scenarios still point to 60% DA
Even under different assumptions for December inflation, the DA outcome does not materially change:
- Index unchanged at 148.2: DA works out to 60.34%
- Index rises to 150.2: DA increases to 60.53%
- Index slips to 146.2: DA still holds at 60.15%
Since the Government of India announces DA only in whole numbers, any figure between 60.00% and 60.99% is officially rounded to 60%. This makes a 2% hike, from the existing 58% to 60%, almost certain.
When will the hike be announced?
While the DA revision takes effect from January 1, 2026, the formal announcement is typically made later. Based on past trends, employees can expect the government to notify the revised DA around March or April 2026, with arrears paid retrospectively from January.
Why this DA hike matters more than usual
This revision is especially significant because January 1, 2026 also marks the formal start of the 8th Central Pay Commission cycle. Historically, when a new pay commission is implemented, the prevailing DA is merged into basic pay and the DA clock is reset to zero under the new structure.
In that sense, the expected 60% DA under the 7th CPC becomes a crucial reference point. It effectively acts as an inflation buffer, influencing discussions around the fitment factor and overall salary restructuring under the 8th CPC.
What employees can expect
If approved as expected, the 2% DA hike will translate into a modest but meaningful increase in monthly take-home salary for serving employees and higher pension payouts for retirees, at a time when retail inflation pressures continue to persist.
Barring an unexpected collapse in December inflation data, the numbers now clearly indicate that 60% DA from January 2026 is a done deal, making this one of the most closely watched DA revisions in recent years.
January 03, 2026, 10:22 IST
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