DA hike news: Which states have announced a 3% Dearness Allowance increase so far?

2 min read | Updated on October 07, 2025, 06:59 IST

SUMMARY

Following the Centre's DA hike announcement, the state governments of Bihar and Rajasthan swiftly implemented the same increase.

The next DA hike will come into effect from January 1, 2026. | Image: Shutterstock

DA hike news: Ahead of the festive season, both the Bihar and Rajasthan state governments have announced a 3% hike in Dearness Allowance (DA) and Dearness Relief (DR), aligning with the recent decision by the Central Government.

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The Union Cabinet approved the 3% DA/DR increase on October 1, 2025, for all Central Government employees and pensioners.

DA new rate: The rate increases from 55% to 58%.

Effective date: The hike is effective from July 1, 2025.

Arrears: Employees will receive arrears for the three months of July, August, and September.

This marks a quick revision following the previous 2% hike announced in March, which took the rate from 53% to 55%.

State Governments follow suit

Following the Centre's announcement, the state governments of Bihar and Rajasthan swiftly implemented the same hike:

Bihar: The Cabinet approved the 3% increase on October 3, 2025. Additional Chief Secretary Arvind Kumar Chaudhary confirmed the rate is now 58%, payable to all government employees, pensioners, and family pensioners, also with effect from July 1, 2025.

Rajasthan: Chief Minister Bhajanlal Sharma approved the 3% hike on Friday, raising the rate from 55% to 58%, effective July 1, 2025.

Why the DA/DR hike matters

Dearness Allowance is a crucial component of a government employee’s compensation, designed to offset the impact of inflation (calculated based on the All India Consumer Price Index).

The DA/DR hike is typically revised twice a year (in January and July). Importantly, this latest revision is likely to be the final one under the 7th Pay Commission, as the 8th Pay Commission is expected to come into effect from January 2026.

Meanwhile, the next DA hike will come into effect from January 1, 2026. It will be decided based on the All India Consumer Price Index for Industrial Workers (AICPI-IW) data of six months from July to December 2025.

Interestingly, the rate of DA applicable in January 2026 may also be used by the 8th Central Pay Commission (CPC) to decide the minimum salary hike factor, or the fitment factor. Therefore, a higher rate DA in January 2026 may lead to a little higher fitment factor under the 8th CPC.