New Delhi, Mar 07, 2018 : In what may bring cheer to lakhs of Central government employees and pensioners, the Cabinet on Wednesday hiked dearness allowance to seven per cent from the existing five per cent in line with the Seventh Pay Commission recommendations. The new increase will come into effect retrospectively from January 1, 2018. At present, Central government employees and pensioners are entitled to five per cent DA, which was effected from July 1, 2016.
The hike will benefit about 48.41 lakh central government employees and 61.17 lakh pensioners.. DA is given to staffers and pensioners to counter the effects of inflation on their earnings. “The Union Cabinet chaired by Prime Minister Narendra Modi has given its approval to release an additional instalment of Dearness Allowance (DA) to Central Government employees and Dearness Relief (DR) to pensioners from January 1, 2018 representing an increase of 2 per cent over the existing rate of 5 per cent of the Basic Pay/Pension, to compensate for price rise,” an official statement said. The statement said that the combined impact on the exchequer on account of both DA and DR would be Rs 6,077.72 crore per annum, and Rs 7,090.68 crore in 2018-19 (for a period of 14 months from January, 2018 to February, 2019).
Apart from approving the two per cent hike in DA, the Cabinet also took a host of other decisions. Ahead of French President Emmanuel Macron’s four-day maiden visit to India from March 9, the Cabinet approved the signing of a Memorandum of Cooperation (MoC) between the two countries in the field of environment.
A Migration and Mobility Partnership Agreement between India and France and a pact on Prevention of the Illicit Consumption & Reduction of Illicit Traffic in Narcotic Drugs, Psychotropic Substances & Chemical Precursors, and related offences was also given the green light by the Cabinet. A framework agreement on the Jaitapur Nuclear Power Project (JNPP) is expected to be signed between the two sides during Macron’s visit.
The Cabinet, chaired by Prime Minister Narendra Modi, also approved amendments to constitution, administration and powers of the local bodies in the Union Territories of Daman & Diu, Dadra & Nagar Haveli and Andaman & Nicobar Islands. To enhance the ease of doing business, two key measures in telecom sector to facilitate investments and consolidation also got the Cabinet nod. The telecom sector is facing Rs 4.6 lakh crore debt and the measures will allow restructuring of deferred payment liabilities of service providers for spectrum and revision of limit of spectrum holding caps.
The Cabinet also cleared the Commercial Courts, Commercial Division and Commercial Appellate Division of High Courts (Amendment) Bill, 2018 for introduction in the Parliament. Once passed, the legislation will allow establishment of commercial courts at the district level in some states as part of the government’s efforts for speedy settlement of high-value business disputes.