Daily Cuurent Affairs for UPSC : 9 Jan 2026/The UN’s World Economic Situation and Prospects (WESP) 2026 report,

Why in the News? The UN Secretary-General, António Guterres, has issued a stern warning regarding the surge in global military spending. This comes at a critical time when US President Donald Trump has proposed a massive 50% increase in the US military budget for 2027, sparking concerns about the diversion of resources from social welfare and global economic stability.

Key Points from the UN Report

1. Surge in Military Expenditure:

• Global Rise: Global military spending reached $2.7 trillion in 2024, the steepest annual increase since 1988.

• Concentrated Spending: Nearly 75% of total spending is driven by the world’s 10 largest spenders.

• “Instruments of War”: The UN warned that countries are spending significantly more on weapons than on investments in peace, infrastructure, and human capital.

2. US Military Budget Proposal:

• Trump’s Directive: President Trump announced via Truth Social that the US military budget for 2027 should be $1.5 trillion (up from a projected $1 trillion).

• Funding Source: The President claimed that revenue from tariffs imposed by the US would allow for this massive budget expansion.

• Current Budget: For context, the US Congress has already approved a budget of $901 billion for 2026.

3. Economic Impacts & Global Rivalries:

• Subdued Growth: Global economic growth remains below pre-pandemic levels due to market fragmentation and trade disruptions.

• Strategic Rivalries: Increased competition for critical minerals is destabilizing governance and social cohesion in affected regions.

• Risk to Vulnerable Economies: The UN warns that the shift toward defense spending threatens to pull money away from development cooperation with poorer nations.

4. India’s Economic Outlook:

• Growth Upgrades: The UN upgraded India’s growth forecast for the 2026 calendar year to 6.6% (a 20 bps increase).

• Future Projections: Growth is expected to pick up slightly to 6.7% in 2027.

• Resilience: India’s economy is supported by strong public investment and resilient consumption, which are expected to offset the negative impacts of US tariffs.

• Short-term Support: Recent tax reforms and monetary easing are also expected to provide a boost to India’s near-term growth.

UN DESA (United Nations Department of Economic and Social Affairs) is essentially the “think tank” of the United Nations. It is the department within the UN Secretariat responsible for the development pillar of the organization.

As shown in your news clipping, UN DESA is the body that produces the World Economic Situation and Prospects (WESP) report, which provides the economic forecasts and warnings you’ve read.

The Three Pillars of UN DESA:

The department’s work is organized into three functional areas:

1. Norm-Setting (Support to Intergovernmental Processes):

• What it does: It helps countries find common ground and set global standards.
• Key Forums: It supports the UN General Assembly, the Economic and Social Council (ECOSOC), and the High-level Political Forum on Sustainable Development.
• Goal: To help member states negotiate agreements on issues like climate change, poverty, and financing for development.

2. Analysis (The Think Tank):

• What it does: It generates and compiles a vast range of economic, social, and environmental data.
• Key Reports: Besides the WESP report seen in the news, it produces the World Social Report, the Sustainable Development Goals Report, and the World Population Prospects.
• Goal: To provide evidence-based research that helps governments identify trends (like the rise in military spending) and decide on policy options.

3. Capacity-Building:

• What it does: It provides technical assistance to help countries translate global agreements (like the 2030 Agenda) into national policies.
• Focus: It works directly with developing nations to strengthen their national institutions, data collection, and social programs.

Key Focus Areas for 2026:

According to recent UN DESA updates for this year:

• Monitoring Trade Tensions: Tracking the impact of US tariffs and trade fragmentation on the global economy.
• Advancing the SDGs: Addressing why progress toward the Sustainable Development Goals (SDGs) has slowed or stalled in many regions.
• Financing for Development: Finding ways to bridge the massive financing gap for climate action and social welfare as debt levels rise globally.