The DA/DR hike will be calculated as due from July 1, 2026. (Image Source: Pixabay) The Union Cabinet on Wednesday approved a 3 per cent increase in Dearness Allowance (DA) for Central government employees and Dearness Relief (DR) for pensioners, providing a festive boost ahead of Diwali. The revision raises the DA rate from 60 per cent to 63 per cent of basic pay and will be effective retrospectively from July 1, 2026. The government has earmarked Rs 10,016 crore for the DA and DR revision, according to the announcement. The increase is expected to benefit approximately 48 lakh Central government employees and 68 lakh pensioners. The Cabinet also cleared three major development initiatives covering domestic container manufacturing, sports goods production and rural governance. The total value of the four approvals stands at Rs 29,267 crore, with the schemes aimed at supporting manufacturing capacity, strengthening local institutions and improving India's industrial ecosystem. DA Hike 2026: What Changes For Employees And Pensioners? The latest revision follows the established formula based on the recommendations of the 7th Central Pay Commission. With the increase, eligible employees will receive DA at 63 per cent of their basic pay, while pensioners will receive DR at the revised rate, subject to applicable rules. Since the revised rates take effect from July 1, 2026, eligible beneficiaries will also be entitled to the difference for the period between the effective date and the implementation of the revised rate. The DA and DR rates under earlier pay commission structures have also been revised: Rs 10,000 Crore Container Manufacturing Scheme Gets Approval Among the other Cabinet decisions, the government approved the Container Manufacturing Promotion Scheme with an allocation of Rs 10,000 crore. The initiative is intended to strengthen domestic container production and support the development of India's manufacturing capabilities. Expanding local production capacity could help build a stronger supply chain for the logistics and transportation sectors. The scheme forms part of the government's wider effort to encourage domestic manufacturing and reduce dependence on external supply sources for important industrial products. She is working as a Chief Copy Editor at Times Now’s Business Desk, where she covers key developments in the stock market, Indian corporates across se... View More