DA for Central govt employees, pensioners hiked to 28% from July

NEW DELHI – The Narendra Modi government on Wednesday increased the dearness allowance (DA) and dearness relief (DR) for Central government employees and pensioners from 17% to 28% with effect from July 1, 2021, ending a 18 month long freeze since January last owing to Covid-19 pandemic.

“In view of the unprecedented situation which arose due to the Covid-19 pandemic, three additional installments of Dearness Allowance (DA) to Central Government employees and Dearness Relief (DR) to pensioners, which were due from 01.01.2020, 01.07.2020 and 01.01.2021, had been frozen,” said the newly appointed information and broadcasting minister Anurag Thakur.

Thakur said the hike represents an increase of 11% over the existing rate of 17% of the Basic Pay/Pension. “The increase reflects the additional installments arising on 01.01.2020, 01.07.2020 and 01.01.2021. The rate of Dearness Allowance/Dearness Relief for the period 01.01.2020 to 30.06.2021 shall remain at 17%,” he added.

An official familiar with the matter said that the DA is allocated with reference to the inflation but the pandemic caused the government to freeze the allowance at 17%. “There is some relief that it has begun, but there is also a disappointment that arrears have not been allocated,” the official said.

Thakur said that the move is expected to cost the government approximately ₹34,400 crore and impact around 4.834 million Central government employees and 6.526 million pensioners.

The Central Cabinet also announced a financial commitment of ₹9,800 crore over the next 5 years for animal husbandry schemes such as Rashtriya Gokul Mission, National Programme for Dairy Development (NPDD), National Livestock Mission (NLM) and Livestock Census and Integrated Sample Survey (LC & ISS). “This would leverage total investment of ₹54,618 crore in livestock sector including share of investments by state governments, state cooperatives, financial institutions, external funding agencies and other stakeholder,” the government said in a press release.

It further stated that “the Rashtriya Gokul Mission will help in development and conservation of indigenous breeds and will also contribute in improving the economic condition of the rural poor. The National Programme for Dairy Development (NPDD) scheme is targeted towards installation of about 8,900 bulk milk coolers, thus providing benefit to more than 800,000 milk producers and 20 LLPD (lakh litre per day) milk will be additionally procured.”

It has also approved a scheme to provide ₹1,624 crore over five years as subsidy to Indian Shipping companies in global tenders floated by Ministries and Central Public Sector Enterprises (CPSE) for import of government cargo.