The Indian Railways has revised dearness allowance and dearness relief for employees and pensions by 2% with effect from 1 January 2026, effectively taking the component to 60% of basic pay from 58% earlier. According to reports from Mint, the Railway Board issued two notifications stating that DA and DR has been revised for lakhs of employees, pensioners, family pensioners, and other eligible beneficiaries covered under the 7th central pay commission (CPC) framework. The Railways Ministry stated that the 2% hike has been approved by President Droupadi Murmu.
As reported by Mint, DA and DR are a percentage of employees' and pensioners' basic salary designed to help mitigate increased cost of living. The notification clarified that 'Basic Pay' in the revised pay structure means the pay drawn in the prescribed Level in the Pay Matrix as per 7th CPC recommendations accepted by the Government, but does not include any other type of pay like special pay. The Railways Ministry added that DA will continue to be distinct element of remuneration and will not be treated as pay, with payment involving fractions of 50 paise and above to be rounded to the next higher rupee.
According to Mint, the Finance Ministry had earlier announced a 2% hike in DA for central government employees on 22 April, effective from 1 January 2026. The Department of Expenditure's memo stated that DA payable shall be increased from 58% to 60% of Basic Pay, where basic pay is the salary drawn in the prescribed Level in the Pay Matrix as per 7th CPC. As reported by Mint, 50 lakh central government employees and around 65 lakh retired central government pensioners benefit from DA hikes, with the increase being approved by President Droupadi Murmu.
As reported by Mint, the Indian Banks' Association (IBA) on 2 May said it has revised DA for bank employees for the months of May, June and July 2026. The IBA notice stated that for employees under XII BPS/9th Note, the increase is as per the All-India Average Consumer Price Index for Industrial Workers (AIACPI-IW) for the quarter ended March 2026. The average CPI for the three months is 148.73, which works out to a 25.70 differential over the 123.03 baseline (CPI 2016), bringing the increase for May, June and July 2026 to 0.70 points.
