Salary increase of central employees decided, dearness allowance will be 60% in January 2026; Know complete details

DA Hike In January 2026: Central government employees and pensioners are not expected to get much increase in salaries in the new year. According to a report by Financial Express, only 2 percent increase in Dearness Allowance (DA) and Dearness Relief (DR) is considered certain from January 2026. With this, the current DA will increase from 58% to around 60%.

This will be the lowest DA hike in the last seven years, just like the increase of only 2% was given in January 2025. Amid rising inflation, there is disappointment among the employees regarding the small DA hike. This time will be special.

This time DA hike is very special

This time’s DA hike is also special because it will be the first increase, which will be implemented outside the 10-year cycle of the 7th Pay Commission. The tenure of 7th CPC ends on 31 December 2025. At the same time, the 8th Pay Commission is still in process and it is not clear anywhere in its terms of reference as to from which date the new salary structure will be implemented.

It will take 18 months just to submit the report to the Commission and after that the process of approval and implementation usually takes another 2 years. In such a situation, the new pay structure may be available to the employees late, possibly in late 2027 or early 2028.

calculation of dearness allowance

Dearness Allowance is calculated on the basis of All-India Consumer Price Index for Industrial Workers (AICPI-IW). The index has increased continuously from July to October 2025, rising from 146.5 to 147.7. This trend shows that inflation persists, but the increase is not fast enough to cause a big jump in DA. Even after adding the figures of November and December, the DA of January 2026 is estimated to be around 60%. That means inflation is increasing, but relief to employees Available only in limited form.

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Direct impact on employees’ pockets

The direct impact of low DA hike is visible on the pockets of employees. For example, if someone’s basic pay is Rs 50,000, then at 58% DA he gets Rs 29,000. With 60% DA it will become Rs 30,000. That means a monthly increase of only Rs 1,000. The upcoming four DA hikes – January 2026, July 2026, January 2027 and July 2027 will be very important, because this is where the future 8th pay commission When it comes into effect, they are included in the new basic pay. So even though the DA hike of January 2026 is small, its impact on the pay structure going forward will be big.