New Delhi: The Union Cabinet on Saturday approved a set of decisions covering social support, infrastructure and strategic risk management.
The Cabinet has approved additional installment of Care Allowance (DA) for central government employees and Poverty Relief (DR) for pensioners, increasing the rate by 2 percentage points to 60% of basic pay/pension with effect from January 1, 2026., to help offset inflationary pressures, according to an official report. The move will cost the exchequer ₹6,791.24 crore annually and benefiting about 50.46 crore employees and 68.27 crore pensioners.
It also approved the creation of a domestic marine insurance mechanism – the Bharat Maritime Insurance Pool (BMI Pool) – backed by a sovereign guarantee ₹12,980 crores. The move comes at a time when global volatility, sanctions risks and conflict-related disruptions have increased uncertainty in marine insurance markets and increased premiums for vessels and cargo.
It will provide cover for Indian flagged or controlled vessels as well as shipping ships cargo from any international origin to Indian ports and vice versa, including those passing through sensitive or unstable sea routes.
Insurance policies will be issued by the participating insurers using the pool’s combined underwriting capacity, estimated at approx. ₹950 million crowns.
On infrastructure, the Cabinet approved continuation of Pradhan Mantri Gram Sadak Yojana-III (PMGSY-III) till March 2028 with revised expenditure ₹83,977 million crowns. The scheme focuses on upgrading rural roads that connect settlements farmers markets, schools and hospitals. The timelines have been extended to March 2028 for roads and bridges in plain areas and roads in hilly areas and to March 2029 for bridges in hilly areas.
“Extending the timeline of PMGSY-III will enable the full realization of the intended socio-economic benefits by ensuring the completion of targeted upgrading of rural roads,” the statement said.
The economic committee of the government, which also met on Saturday, approved two projects under the ministry railway with a total cost of approx ₹24,815 million crowns. These projects include: Ghaziabad–Sitapur third and fourth lines and Rajahmundry (Nidadavolu)–Visakhapatnam (Duvvada) third and fourth lines.
