What is Dearness Allowance (DA)?
Dearness Allowance is a cost-of-living adjustment paid to Central Government employees and pensioners (as Dearness Relief) to offset inflation. It is revised twice a year — effective 1 January and 1 July — based on the movement of the All-India Consumer Price Index for Industrial Workers (AICPI-IW) over the preceding 12 months. DA is calculated as a percentage of Basic Pay and is one of the largest components of take-home salary after Basic Pay itself.
Formula Used
2.88 links the current 2016-base AICPI-IW series to the 2001-base series used in the original 7th CPC formula. 261.42 is the average 2001-base AICPI-IW for calendar year 2015, the reference point fixed at 7th CPC implementation. Read the complete explanation, including a worked example for the last confirmed revision, in How the Government Decides DA — Complete Guide.
Why two months are still "editable estimates"
The AICPI-IW for a given month is released by the Labour Bureau roughly four weeks after that month ends. For a 1 July revision, the calculation needs the average index from July of the previous year through June of the current year — so the June figure is published only in the last week of July, weeks after the calculator page needs to show an estimate. This tool pre-loads all published figures and lets you edit the remaining month(s) to see how the final index reading could move the projected DA up or down.
When is the DA hike officially announced?
Although the AICPI-IW data needed for the calculation is available by late July (for a July revision) or late January (for a January revision), the Union Cabinet typically approves and the Department of Expenditure notifies the actual DA order only some weeks to a couple of months later — historically in September–October for the July revision, and in March for the January revision. Employees receive the difference for the intervening months as one-time arrears along with the first revised salary.
Source references
Frequently Asked Questions
How is DA different from HRA and other allowances?
Why does this calculator show a range instead of one fixed number?
Is this an official DA announcement?
Why is DA revised effective from January and July, but announced later?
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Last updated: 18 August 2026 · This calculator is an estimate based on the inputs and assumptions stated above. It is not an official calculation — verify any figure that affects a service decision against the applicable rules and with your Pay and Accounts Office or Administration Section. Terms & Disclaimer.