AICPI-IW up 0.5 in November: Dearness Allowance hike, 8th Pay Commission salary may be impacted

The Labour Bureau under the Union Ministry of Labour and Employment has reported the fifth consecutive monthly increase in the All India Consumer Price Index for Industrial Workers (AICPI-IW), a critical metric for determining dearness allowance and, in turn, the monthly in-hand pay of central government employees and pensioners.

In November 2025, the AICPI-IW increased by 0.5 point to 148.2. Previously, the inflation index had increased by 0.4 point in October, 0.2 in September, 0.6 in August and 1.5 in July 2025.

"The All-India CPI-IW for November, 2025 increased by 0.5 point and stood at 148.2 (one hundred forty-eight point two)," the Labour Bureau said in a press release dated December 31, 2025.

How can AICPI-IW data impact DA hike?

As per the formula recommended by the 7th Pay Commission, the AICPI-IW data of the past six months is used by the government to calculate the rate of dearness allowance hike for employees and dearness relief (DR) hike for pensioners.

The government revises the DA/DR rate twice a year. While the last hike was effective from July 1, 2025, the next raise is likely to be given with effect from January 1, 2026.

For the DA hike effective from January 1, 2026, the government will consider the AICPI-IW data from July to December 2025.

Now the AICPI-IW has increased from July to November. If this trend continues in December also, then employees can expect a decent hike in dearness allowance.

However, please note that the final decision about the DA/DR hike is in the hands of the government. So one can't predict the exact percentage of DA/DR hike.

Can AICPI-IW data impact 8th Pay Commission salary?

The answer is both yes and no. Let's understand:

The 8th Central Pay Commission (CPC) recently began its work as per the Terms of Reference notified by the government.

In the past, pay commission have used applicable rate of dearness allowance in their pay hike calculations. If the 8th CPC also follows this trend, then it may use the DA applicable from January 1, 2026 for calculating pay hikes. A higher DA in January could mean a higher pay hike. However, this will depend on whether or not the pay commission decides to the DA data in its calculations. It may even come up with a new method for calculating pay hikes.

Further, as the 8th Pay Commission has just started its work, it is too early to make any assumptions about the method it will adopt for pay revision.