This would result in an additional financial burden of over Rs 1,000 crore on the Government coffers, official sources said.
The enhanced DA will be applicable from January 1, 2016, according to an order issued by Special Chief Secretary (Finance and Revenue) Ajeya Kallam.
The DA arrears on account of the hike would be credited to the Provident Fund accounts of the employees in April, he said.
Enhanced DA from next month would be paid in cash to all employees, including those working in local bodies and teaching institutions, the order said.
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