UN’s Financial Crisis Is Real And Needs A Solution, Says India

India, which owes $38 million from the United Nations for peacekeeping operations, has called for a comprehensive solution to address the "real" financial crisis facing the global body, saying countries that owe arrears are "insured" from the impact of their inaction.

The UN's peacekeeping financial year is ending on June 30 and member states are yet to pay $1.9 billion worth of assessments for peacekeeping budget and $1.5 billion worth of assessments for the Regular Budget, India's Deputy Permanent Representative to the UN Ambassador K Nagaraj Naidu said at a session on 'Improving the Financial Situation of the United Nations’.

Naidu said many Troop Contributing Countries, including India, are awaiting for "long, legitimate reimbursements" from the closed peacekeeping missions. "Our expectation is that the problem be discussed and addressed comprehensively, he said.

The UN owes India $38 million, among the highest it has to pay to any country, for peacekeeping operations as of March 2019, UN Secretary General Antonio Guterres had said in his report on improving the financial situation of the UN released in April.

Naidu said the UN Secretariat briefed the member states earlier this month of the large amounts of reimbursements that were due to the TCC. These include troops cost with $339 million and Contingent Owned Equipment claims from the active and closed missions worth $670 million.

"Yet there is reluctance in some quarters to recognise the financial problems being faced by the UN," he said adding that the crisis is real and present and we need a solution that works.

Naidu voiced concern over the practice of meeting the cash requirement of active missions by dipping into the cash pool of closed peacekeeping missions and delaying reimbursements to Police and Troop Contributing Countries, saying it has over a period of time created a false sense of financial soundness.

"This approach of creative accounting in managing a financial crisis has never worked and never will. It appears that the countries that owe arrears are somewhat insured from the impact of their inaction," Naidu said.

He also said that the arrears have grown larger and with it the expectations from the arrear-owing countries that the Secretariat would somehow manage the status quo, even if it requires calibrating the reimbursement framework.

The United Nations owed more than $250 million to troop- and police-contributing countries at the end of 2018 and again at the end of the first quarter of 2019. This debt is likely to again exceed $400 million at the end of June 2019, similar to the situation at the end of June 2018, Guterres said.