The Union Cabinet has cleared a 2 percent hike in Dearness Allowance (DA)  for central government employees, according to a report by The Times of India.

The move comes at a time when employee unions are pushing for broader salary reforms under the proposed 8th Pay Commission. The National Council–Joint Consultative Machinery (NC-JCM) has recommended a fitment factor of 3.83, which could potentially raise the minimum basic salary from Rs 18,000 to nearly Rs 69,000.

The body has also suggested changes to the salary framework, including widening the definition of “family” to cover dependent parents, reducing pay disparities, and introducing higher increments along with allowances linked more closely to inflation.

Separately, the Cabinet has reportedly approved the creation of a Rs 13,000 crore Sovereign Maritime Fund aimed at offering affordable insurance support for Indian-flagged ships and vessels connected to India.

In addition, TOI reported that the government is likely to extend the Pradhan Mantri Gram Sadak Yojana (PMGSY) till 2028, with an extra allocation of Rs 3,000 crore.