The Dearness Allowance (DA) and Dearness Relief (DR) are adjustments provided by the Central government
The DA is applicable to employees, while the DR is for retired personnel.
The rates of DA and DR are revised every six months to offset the impact of inflation on the monthly salary and pension.
Dearness Allowance percent = ((Average of AICPI (Base Year 2001=100) for the past 12 months - 115.76) / 115.76) * 100
For instance, a 4% increase in the DA could potentially raise the current rate from 42% to 46%.
The impact of this hike varies based on the employees' basic salary
A maximum basic salary of Rs 56,900, the current 42% DA translates to a monthly increase of Rs 23,898.
potential 46% DA, this could rise to Rs 26,174, signifying a substantial annual salary increase of Rs 27,312.
The last DA hike occurred in March 2023,
when the Central government granted an additional 4% installment of DA over the existing rate of 38% of the Basic Pay/Pension, effective from January 1, 2023.
There is anticipation that the next DA hike may be announced between Navratris and Diwali, but there is no official statement as of yet.