Variable Deaness Allowance is a part of Dearness Allowance.
Dearness Allowances generally is divided in to FDA ( Fixed Dearness Allowance ) and VDA ( Variable Dearness allowance) in private Sectors and in government organisations , the DA is directly linked to Cost of living index.
In Case of FDA & VDA present in a salary structure , it is calculated as under ( hereagain , the DA Points w.r.t to a Cost of living index base- you can get this in Chamber of commerce and other forums);
Total DA points say 100
FDA freezed for 70 Points @ Rs. x.
( This freezing of points and FDA amout will vary from one orgainisation to another depending on the no.of settlements made / no.of years the org. exists.)
VDA calculated for balance 30 points at a rate agreed/ arrived at.
18th July 2007 From India, Coimbatore