Dearness Allowance Rate for PSU Employees for April 2026 to June 2026: Complete Working
Dearness Allowance (DA) is a crucial salary component for PSU employees, designed to offset the impact of inflation on the cost of living. It is calculated as a percentage of the basic pay, and the rate is revised periodically based on movements in the Consumer Price Index for Industrial Workers (CPI-IW) published by the Ministry of Labour and Employment.
For the 1st quarter of the financial year 2026–27 (i.e., from April 2026 to June 2026), the Dearness Allowance for PSU employees has been calculated at 54.10%, marking a modest upward revision from 53.40% applicable for the 4th quarter of 2025–26 (January 2026 to March 2026). This revision represents an increment of 0.70% in the DA rate.
Understanding the Role of Dearness Allowance (DA)
Dearness Allowance is computed as a fixed percentage of an employee’s basic salary and is intended to cushion the impact of inflation.
Illustration of DA Calculation on Salary
Assume an assessee, Mr. Sharma, is employed in a PSU and receives a basic salary of ₹62,000 per month. If the DA rate for the quarter is 54.10%, his monthly DA would be calculated as:
- Basic salary: ₹62,000
- DA rate: 54.10%
- DA amount: ₹62,000 × 54.10% = ₹33,542
Thus, Mr. Sharma’s Dearness Allowance for the month would be ₹33,542, payable in addition to his basic salary and other allowances, such as House Rent Allowance (HRA), transport allowance, etc.
Note: DA is expressed as a percentage of basic pay and is revised periodically based on CPI-IW data issued by the Labour Bureau under the Ministry of Labour and Employment.
CPI-IW as the Basis for DA Revision
The Ministry of Labour and Employment, through the Labour Bureau, regularly publishes the Consumer Price Index for Industrial Workers (CPI-IW), which serves as the fundamental input for DA computation.
For determining the DA applicable for the 1st quarter of FY 2026–27 (April 2026 to June 2026), CPI-IW indices for the preceding three months have been considered, namely:
- December 2025
- January 2026
- February 2026
CPI-IW Figures Used for Q1 2026–27 DA Working
The relevant CPI-IW indices notified by the Labour Bureau are as under:
| Month | CPI-IW Index |
|---|---|
| December 2025 | 148.20 |
| January 2026 | 148.60 |
| February 2026 | 148.50 |
These figures form the base for deriving the adjusted CPI and, ultimately, the DA percentage for PSU employees.
Trend in DA Rates for Recent Quarters
The table below captures the Dearness Allowance percentages for the recent quarters along with the quarter-on-quarter change:
| FY | Quarter | Period | DA Rate | Change (%) |
|---|---|---|---|---|
| 2023-24 | Q1 | Apr 2023 – Jun 2023 | 37.70% | – |
| 2023-24 | Q2 | Jul 2023 – Sep 2023 | 39.20% | 1.50% |
| 2023-24 | Q3 | Oct 2023 – Dec 2023 | 43.80% | 4.60% |
| 2023-24 | Q4 | Jan 2024 – Mar 2024 | 43.70% | -0.10% |
| 2024-25 | Q1 | Apr 2024 – Jun 2024 | 44.30% | 0.60% |
| 2024-25 | Q2 | Jul 2024 – Sep 2024 | 44.80% | 0.50% |
| 2024-25 | Q3 | Oct 2024 – Dec 2024 | 47.70% | 2.90% |
| 2024-25 | Q4 | Jan 2025 – Mar 2025 | 49.60% | 1.90% |
| 2025-26 | Q1 | Apr 2025 – Jun 2025 | 48.70% | -0.90% |
| 2025-26 | Q2 ... |