DA Hike News: The Narendra Modi-led Union government on Thursday announced a mega Diwali bonanza for central government employees and pensioners as it hiked the Dearness Allowance (DA)/ Dearness Relief (DR) by 3 percent to compensate price rise ahead of the festival of lights later this month. When will DA hike come into effect? I&B Minister Ashwini Vaishnaw informed that the decision was taken at a meeting of Union Cabinet led by Prime Minister Narendra Modi and is set to benefit around 49.19 lakh central government employees and 68.72 lakh pensioners. The 3 percent DA hike over existing rate of 55 per cent of the basic pay/pension to compensate against the price rise will come into effect retrospectively from July 1 2025 Vaishnaw said. The minister said the combined impact on the exchequer on account of an increase in DA and DR will be Rs 10083.96 crore per annum adding that the DA hike is in accordance with the accepted formula based on the recommendations of the 7th Central Pay Commission. Meanwhile the Cabinet Committee on Economic Affairs (CCEA) chaired by PM Modi also approved the increase in the Minimum Support Prices (MSP) for all mandated Rabi Crops for Marketing Season 2026-27. The government has increased the MSP of Rabi Crops for Marketing Season 2026-27 to ensure remunerative prices to the growers for their produce. Centre slashes GST rates Notably the Centre revises DA/DR twice a year. The last revision announced in March was effective from January 1 2025 when the DA was hiked by 2 percent taking the DA/DR rate to 55 percent. The DA/DR hike comes days after the Central government introduced sweeping GST reforms that has slashed prices of mass consumption items like ghee paneer butter namkeen ketchup jam dry fruits coffee and ice creams while aspirational goods like TV AC washing machines and other electronic gadgets have also become cheaper. (With inputs from agencies)