The revised rates will come into effect from January 1, 2026, with a 2% increase over the existing 58%, raising the total DA/DR to 60% of Basic Pay/Pension. This move aims to help employees and pensioners cope with rising inflation.

According to official estimates, the decision will have a combined annual financial impact of ₹6,791.24 crore on the exchequer. The benefit will reach around 50.46 lakh Central Government employees and 68.27 lakh pensioners across the country.

The revision follows the established formula based on recommendations of the 7th Central Pay Commission, ensuring that compensation keeps pace with price rise.

This latest hike continues the government’s policy of periodic DA revisions to support income stability amid changing economic conditions.