New Delhi: The Union Cabinet, chaired by Prime Minister Narendra Modi, has approved a three per cent increase in Dearness Allowance (DA) and Dearness Relief (DR) for Central Government employees and pensioners, effective from 1 July 2025.
The hike raises the existing rate from 55% of basic pay and pension to 58%, aimed at mitigating the impact of rising prices.
The government stated that the move will benefit approximately 49.19 lakh employees and 68.72 lakh pensioners across India. The annual financial implication of the increase on the exchequer is estimated at Rs 10,083.96 crore.
The adjustment follows the formula prescribed by the 7th Central Pay Commission, which periodically reviews DA and DR to protect the purchasing power of government staff and retirees.
BI Bureau
