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What are X, Y, and Z city categories? Have you ever wondered why the House Rent Allowance (HRA) received by government employees varies? Or why is living in some cities is very expensive while in others it's very cheap? The Indian government has divided the country's cities into three categories: X, Y, and Z. Most people are unaware of this, but everything from your salary to your amenities depends on it. Let's understand how.

How are city categories determined?
The biggest criterion for placing a city in the X, Y, or Z category is its population. The government updates this list periodically based on the census.

1. 'X' Category Cities (Top Tier)
These are the largest and most expensive cities in the country. They can also be called 'metropolitan cities'.

Population
The population here is more than 50 lakhs.

Which cities are included?
This includes cities like Delhi, Mumbai, Kolkata, Chennai, Bengaluru, Hyderabad, Ahmedabad, and Pune.

Benefit
Government employees living here receive the highest HRA (House Rent Allowance) because house rent and the cost of living are very high.

2. 'Y' Category Cities (Middle Tier)
These are cities that are not metropolitan but are quite developed.

Population
The population here is between 5 lakhs and 50 lakhs.

Which cities are included?
This includes cities like Lucknow, Jaipur, Patna, Indore, Chandigarh, and Surat.

Benefit

The cost of living here is less than in 'X' category cities, so the allowances received are also slightly lower.

3. 'Z' Category Cities - Lower Tier
Cities that do not fall into the X and Y categories are placed in the Z category.

Population

The population here is less than 5 lakhs.

Which cities are included?
Small districts, towns, and villages are part of this category. The cost of living here is the lowest.

What is the impact on the common man? It's not just government jobs; private companies also consider these categories before opening their offices and deciding on salary packages.

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