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PREDICTION OF BANKRUPTCY RISK IN INDIAN BANKS: AN APPLICATION OF ALTMAN’S MODEL

*Prashant Kumar **Kavita,

ABSTRACT

After the financial crisis and pressure of implementing Basel III norms, financial solvency has become top priority for the banking sector, because there are some factors like failure of management, competition, increasing NPAs, growing incidence of fraud, inability to meet regulatory requirements which create the probability of risk and leads to financial distress. In this context, measuring financial health of a bank has become an imperative need. Bankruptcy risk has always been a matter of concern not only for bankers but for all stakeholders in the business world because the risk can seriously jeopardizes the affairs of the business. Therefore proper assessment of bankruptcy risk is required to smooth functioning of banks and proper implementation of Basel III regulations. It is contemporary to study solvency position of Indian banks. The axle of this study is to predict the financial health and risk of bankruptcy by applying Altman Z Score model in the selected Indian banks. This model highlights that the position of the banks, under study is healthy and comparatively sound. It can be concluded that the selected Indian banks which are under study falls in ‘safe Zone’ as per Z-score criteria and there is not any chance of financial distress.

Keywords: Bankruptcy risk, EBIT, Financial health, financial ratios, Z-score.

Introduction

Banks play significant role in the financial stability of any economy as banking sector is the main component of financial system. A stable and financially sound banking system leads to economic development of any country. Now these days, financial stability has become the major issue for banking sector because there are some factors such as failure of management, external factors, competition, increasing portfolio of NPA, growing incidence of fraud, inability to meet regulatory requirements which create the probability of risk and leads to financial distress.  Banking sector faces various types of risk viz. credit risk, market risk, liquidity risk, foreign exchange risk, political risk, sovereign risk, interest rate risk, operational risk etc. and high intensity of risk leads to business failure (Campbell 2007).

There are five stages of business failure such as incubation, financial embarrassment, financial insolvency, total insolvency and confirmed insolvency (Fitzpatrick 1932). Bankruptcy or insolvency is the form of financial failure refers to where a firm cannot meet its current obligations, when the current obligations exceed the current assets.

Bankruptcy is a severe matter and very common thing among companies and financial institutions. There may be many reasons like changes in market policy, inflation and political reasons which have led to bankruptcy (Movaziri et al, 2012). Bankruptcy can be used as a proxy for measuring economic sustainability. Because it is considered that bankrupt banks have weak position while non-bankrupt banks have strong economic sustainability and long term survival (Amin Jan et al, 2015).

Global financial crisis blessed with inflation, currency deterioration, economic uncertainty, high interest rates and many other uncontrollable factors was enough to break down the resilience of financial sector. The Financial soundness of banking sector is backbone of every economy. In this context, it is very crucial to analyze the financial soundness of domestic banks (Nishi sharma et al, 2013). Bankruptcy prediction is of immense importance to both for lenders as well as for the investors. There are many techniques that have developed to assess the bankruptcy risk. Bankruptcy is a worldwide problem.  Bankruptcy histories shows that a company with efficient management, strong financial performance and capable to grow without any distress symptoms, can be turned out to be a sudden bankruptcy. In the period from 2000 to 2011, it has been witnessed a wave of bankruptcies in the giant companies like, Lehman Brothers, Enron give examples to the world that no matter how strong the company is, it can face bankruptcy if it is not well managed. On 30th November 2001, Enron bankruptcy was reported and appealed for bankruptcy protection on the 2nd of December 2001. The other company is Lehman Brothers which was the fourth largest investment bank in US.  Lehman filed for bankruptcy protection in 2008 to avoid the possibility of being distressed (Anita et al, 2013). There is a dire need to manage risk of bankruptcy as it is the critical issue for banks. Prediction of bankruptcy is one of the challenging task for every organization (Fawad et al, 2014). In 2008, the largest bankruptcy in U.S. history represents an example for Indian banks to manage their cash flows efficiently .Thus careful attention to the impact of bankruptcy risk level on bank’s profitability is necessary because intense risk puts serious threat to banks and increasingly level of risk may create a chance of closing down the bank’s operations. Financial soundness is of prime importance in the current crisis and financial scams scenario in the banking sector (Parul Chotalia 2014). In the wake of the financial crisis of 2008, Basel-III accord was released in 2010. The New Basel Capital Accord (popularly known as Basel-III) is desirable regulation and major agenda for the commercial banks in India and across the world. The main focus of Basel-III is on the estimation of capital requirements which would ensure financial stability and determine the common standards of banking regulation. From the perspective of Basel III, to maintain the higher capital requirements and to comply with Basel III norms are the concerned areas for banks. Thus, Indian banking sector need to predict bankruptcy risk and analyze their financial statements because the risk of bankruptcy directly hits the financial strength and earnings of banks. Therefore proper assessment of bankruptcy risk is required to smooth functioning of banks and proper implementation of Basel III regulations. The prediction of business failure is an important step for taking timely corrective and remedial measure for protecting business from the problem of bankruptcy. The basic concern of prediction is to evaluate the terms of credit and ensure repayment safely (Roli Pradhan 2014). The problem of business failure is attributed to both financial and non-financial causes such as poor planning, inefficient management and fraud. There is need for predicting financial failure on time for taking curative measures in relation to financial investments (Venkata Ramana et al, 2012).

There are many different models to forecast the complex problem of bankruptcy. There may be many  internal credit rating model used  for bank which improves their current predictive power of financial risk factors and explained how banks assess the credit worthiness of the borrowers and how can they identify the defaulters so as to improve their credit evaluation process (Kishore Navin 2011).  Many internal and external users of financial statements like banks, credit rating agencies, underwriters, auditors, policy makers and regulators analyze company’s financial position. For this purpose different approaches and models are used. During financial and economic crisis selection of model for bankruptcy prediction is essential.  For example when bank financially assists a company, bank predicts risk of bankruptcy of that company prior to financial help. The prediction models are used to check the bankruptcy and can be applied to modern economy to predict distress and bankruptcy of one, two and three years in advance (Sanobar Anjum 2012). But the most influential model is Altman Z score model due to most acceptable and widely used. The well-known Altman model developed by Edward Altman in 1968 called Z score model has been identified as independent variables (financial ratios) as well as the relative weight of each variable which represents dependent variable (Z) through an analytical study of a sample of US companies in 1968 (Ali Abusalah et al, 2012).

ALTMAN’S Z-SCORE MODEL

The Z-score model was constructed by Edward I. Altman in 1968 (Assistant Professor of finance at New York University). It is a multivariate formula and powerful diagnostic tool that measures the probability of bankruptcy within a two year period with proven high degree of accuracy. This model is known as bankruptcy prediction model and has gained popularity since 1985 (Altman 1968). Altman used 22 variables from the financial reports of 66 publicly held manufacturing companies in USA with assets of more than $1 million. The 66 companies were categorized into 2 groups, 33 failed and 33 successful. Altman’s Z-value is derived through a multiple discrete analysis (MDA). The discriminant analysis was applied to calculate the coefficients for Z-score equation. Altman first compiled 22 variables describing the standard ratio categories. He reduced his selection to five ratios. This model is also called multiple discriminant analysis model (MDA).  Z score analysis is capable of predicting default through combining various financial ratios (M Jayadev 2006).  Altman model may be used as an indicator and evidence to determine the firm’s bankruptcy and credibility.  Altman’s z-score model predicts the corporate default and measure financial distress status of companies. Z-score is calculated by multiplying the coefficients by each of financial ratio. Linear combination of 5 common financial ratios has been widely used to predict default risk.  Altman’s model has found 95.0% accuracy rate and also called Zeta. This model is internationally accepted. The Z score original model was developed in 1968 for manufacturing firms.  Altman again devised the Z score to be adapted for private companies in 1983.This model was further developed to create the Z Score model for emerging market companies and for non-manufacturers in 1993. This model kept the first four variables. Altman’s models are:

  • Original model for manufacturing firms
  • Revised model for privately held firms
  • Revised four model for non-manufacturing or emerging market

 Table 1 ALTMAN’S INDEX                          

                                                             COEFFICIENTS
RATIOS Original Model 1968 Revised model
1983
Revised four model
1993
X1 = WC/TA 1.21 0.717 6.56
X2= RE/TA 1.41 0.847 3.26
X3 =EBIT/TA 3.30. 3.107 6.72
X4 = MVE/TL 0.60. 0.42 1.05
X5 = S/ TA 1.09 0.998 N/A

Table 2 Altman’s benchmark

Score 1968 Score 1983 Score  1993 Interpretation
Z > 2.99 Z > 2.90 Z > 2.60 Non-bankrupt firms, Safe zone
1.81 < Z < 2.99 1.23 < Z <2.90 1.10 <Z < 2.60 Difficult to predict, Grey zone
Z < 1.81 Z < 1.23 Z <1.10 Distress zone, bankrupt firms

Source: Author

FINANCIAL RATIOS

Bankruptcy predictions are based on accounting ratios and other financial variables. Linear discriminant analysis was the first statistical method applied to explain which firms entered in bankruptcy (Richard et al, 2014). The most widely used tool for financial analysis is financial ratios. Financial analysis discloses the financial performance of firm and indicates the possible causes standing behind the deterioration of financial performance (Obaid Saif 2011). Ratios have been using for many years by investors, creditors, lenders, stockholders, auditors and others who may get substantial losses as a result of business failure. Researchers have used financial ratios to construct business failure prediction models. Ratio analysis is used in various part of the world for measuring financial accuracy and creditworthiness of the firms (Vineet et al, 2014).

Financial ratios are the significant component of financial analysis to evaluate and analyze the financial statements. Altman used five standard ratios in Z score viz. liquidity ratio, profitability ratio, leverage ratio solvency ratio, activity ratio. Financial ratios are used to assess profit and risk and provide the basis for estimating the results of business operations and explaining how well a business is doing (Khalid Al-Rawi et al, 2008). Financial ratios are good indicator of the probability of bankruptcy.  While analyzing the ratios, formulas are used to determine the financial position of the firms. Ratio predicts the financial soundness of the firms whether a firm is going to bankrupt or not (Bashar 2015). Financial ratios have been used for making comparison among the firms in same industries. Efficient performing firms have been identified through their financial analysis and higher performance of firms makes their transition towards adopting new regulations easily (Ravi Chandran 2015).

VARIABLES USED IN ALTMAN’S Z-SCORE MODEL

X1 Working Capital/Total Assets

This is the most valuable variable to predict bankruptcy. This liquidity ratio calculates the ability of the firm to finance its short term obligations. A decreasing figure will suggest the higher chance of bankruptcy. This ratio is the measure of liquid asset of firm in relation to total capitalization. WC (working capital) = current assets – current liabilities.

X2 Retained Earnings/Total Assets

This variable indicates the ability of a firm to accumulate earnings using its assets. The higher the ratio the better as it suggests the firm can accumulate earnings. A young firm will usually display a very low RE/TA as it has not had the time to build up cumulative profits hence the incidence of failure is much higher in a firm’s earlier years (Altman, 1968).

X3 Earnings before Interest and Taxes/ Total Assets

This indicates company’s profitability and company’s assets. The decreasing ratio indicates the firm is not earning and decreasing the profit on each investment.

X4 Book Value Equity/ Total Liabilities

This expresses the financial leverage i.e. the proportion of equity. It is directly related to solvency position of firm. It calculates how much the firm’s market value would decline before the liabilities exceeds the assets and firm becomes insolvent. If the market value of equity is below the total debt the firm becomes insolvent.

X5: Sales/Total assets

The sales of a firm depict the manufacturing capability of companies’ assets. In Altman’s model this financial ratio did not deliver any statistical significance but he still found it to be useful to default prediction because of the relationship to other variables in the model (Altman 1968).

USES OF Z-SCORE

Altman’s model still exists and used by the financial institutions to measure creditworthiness of the companies Z score is a beneficial analytical tool and the application of Altman’s failure prediction model is not constrained by geographical boundaries (Oforegbunam et al, 2011). Altman’s model provides credibility to the valuation process. It helps in evaluating the reliability statistically and providing insight into relative performance and financial viability (Altman 2000). The Z-score is the best measure for evaluating the financial soundness of a firm that shows the lower the score higher the chance of failure. The importance of Z-score can be identified by a number of studies. Altman’s Z-score model has been used to predict the financial distress in a number of sectors like empirical analysis examined 21 textile companies listed in the Karachi stock exchange, during the period 2000 to 2010. These result for bankrupted and non-bankrupted show that Altman model can give good predictions (Fawad Hussain et al, 2014), predicted the risk of bankruptcy in cement companies (N VenkataRamana et al, 2012), Measured the financial health of Indian Logistic industry (Vikas Tyagi 2014), Indian Steel industry (M.S.Ramaratnam et al, 2010), Automobile Industry of India (Sarbapriya Ray et al, 2011), Sugar Manufacturing Units (Ramana Reddy et al 2013), Seed industry in India (Praveena et al, 2012).

 Z score has been used as a tool to measure credit risk (Sairani et al, 2014), Altman score is applied to test credit worthiness of company. It can be concluded from the study that the banks face risk more consciously. The model calculates the financial soundness of corporate house in terms of Z values. Z score has originally been devised to signal the probability of bankruptcy of manufacturing firms. But it has been frequently updated to make it applicable for private companies, non-manufacturers and service industries. The model presents for more than 70% accuracy in predicting bankruptcy (Nishi et al, 2013). This study contributes to the field of accounting and finance, specifically on bankruptcy prediction in a developing country. The study is limited to only fifteen quoted firms including Food & Beverages, Manufacturing, Printing, Insurance, Trading in Ghana (Kingsley Opoku Appiah 2011). The empirical analysis by (M Sulphey 2013) examined 220 companies of BSE small cap for financial solvency using Z score. The result showed that only 79 companies were in safe zone. 117 companies were difficult to predict and 24 are the bankrupt firms. The study proved the efficiency of Altman model in predicting failures. The wide usage of the Z-Score Model as a measure of financial distress in the economic and financial research points out that it is widely accepted because it is a simple and consistent measure of calculating bankruptcy.

A popular risk measure in the banking and financial solvency related literature that reflects a banks probability of insolvency is the Z-score. Its widespread use is because of its simplicity and it can be calculated using only accounting information (Laetitia Lepetit 2015).

CRITICS OF Z-SCORE

This model does not always have the same accuracy to different business entities. This model is criticized for discriminating only among three borrower behavior; high, indeterminate, and low default risk. The weights in the Z-score model will be constant or not over any but very short periods, there is no reason to expect. The model ignores important factors (such as qualitative and macroeconomic factors) that may play a significant role in the default or non-default decision.

 OBJECTIVES OF THE STUDY

  • To analyze the financial soundness and risk of bankruptcy in selected Indian public sector and private sector banks.
  • To compare the financial soundness of selected Indian public sector and private sector banks.

 

 MATERIAL AND METHODS

The present study is an attempt to analyze bankruptcy risk in banking sector through the application of Altman Z-score which helps in forecasting the financial health of bank. In order to achieve the objectives of research, a descriptive and analytical approach has been used. Five banks were selected from public sector and five banks were selected from private sector. The present study predicts Z score for 10 Indian banks for a period of 5 years from 2011-2015. Public sector Banks namely state Bank of India, Bank of Baroda, Canara Bank, Punjab National Bank and Union Bank of India and Private sector Banks namely ICICI, Axis Bank, Yes Bank, IndusInd bank and Kotak Mahindra bank were chosen. Data for the present study were collected from secondary sources including bank’s annual report and The Economic Times (newspaper) website for last 5 years to generate the financial ratios. The period of the study is 2011-2015. Altman Z-score model for non-manufacturer or emerging markets (1993) has been used in this study.

The revised Z-score is as:

Z = 6.56 X1 + 3.26 X2 + 6.72 X3 + 1.05 X4

Whereas:

Z = overall score

X1 = working capital / Total Assets

X2 = Retained earnings/ Total Assets

X3 = Earnings before interest and taxes/ Total Assets

X4 = Book Value of Equity / Total Liabilities

 

Altman’s Z score value

 Z Score > 2.60 shows firms are in safe zone, Z < 1.10 reflects firms are in distress zone, 1.10 <Z< 2.60 indicates firms are in grey zone and difficult to predict.

 

 

 

 

 

HYPOTHESES

Two hypotheses have been formulated according to the objectives of study:

Null hypothesis H0: Banks are likely in financial distress and going to bankrupt within twelve months.

 Alternate hypothesis H1: Banks are not likely in financial distress and not going to bankrupt with in twelve months.

H’0:  There is no difference between the financial performance of public sector banks and private sector banks.

H’1:  There is difference between the financial performance of public sector banks and private sector banks

 RESULTS AND DISCUSSIONS

This study was intended to identify the risk of bankruptcy in selected Indian public and private sector banks. Average Z-score have been calculated for 5 Indian public sector and private sector banks from 2011 – 2015. The score would help to identify the financial viability of the banks. This can be presented as:

                         Figure1 Average Z-score of banks (2011-2015)

    Source: Author

It can be seen from the graph that all 10 banks comprise five public sector and five private sector banks come under safe zone. The Z score value of selected Indian banks shows that no banks are going to bankrupt. All banks are in safe zone as their Z score values are more than 1.1                   

 

Figure 2 Z score value for public sector banks

Source: Author

 Public sector banks secured Z score value more than 2.6 means no banks are in distress zone, all banks are safe. This shows bank under observations are not facing bankruptcy. SBI secured highest value among public sector banks in 2015.

Figure 3 Z score value for private sector banks

Source: Author

The graph indicates all five private banks are in safe zone as their Z score value is greater than 2.6. IndusInd bank got highest value among private sector banks. In comparison of last year, Z score value has decreased for IndusInd, Axis bank, Kotak and ICICI bank, but banks position is in safe zone.

Table3 Z SCORE BASED RANKS

Sr.no BANKS Average z score 2015 Z score rank 2015 Average z score 2014 Z score rank 2014
1 Bank of Baroda 5.5348 2 5.4345 2
2 State bank of India 6.2698 1 5.7104 1
3 Punjab national bank 5.0451 6 5.0623 5
4 Canara bank 5.1421 4 5.1225 3
5 Union bank of India 5.0774 5 5.0315 6
6 Yes bank 4.2333 10 4.3073 10
7 ICICI 4.8821 8 4.8716 9
8 Axis bank 4.8786 9 4.9343 7
9 IndusInd bank 5.1691 3 5.0781 4
10 Kotak Mahindra bank 4.8898 7 4.9236 8

Source: Author

Altman model assigns highest rank to SBI among 10 Indian banks. The second rank is assigned to Bank of Baroda which is followed by IndusInd bank. However, other banks are also in safe zone as they secure more than 2.6 score. Z score for Yes bank is the least which is followed by Axis bank.

Figure4 Z score value for Indian public and private sector bank

Source: Author

Z score value of selected Indian banks in 2015 is more than 2.6. In 2015 SBI got highest value among all banks. But as compared to 2014 few banks show decreasing trend such as PNB, Axis bank, Yes bank and Kotak bank. Z score value for IndusInd bank, ICICI, Union Bank of India, Canara bank, SBI and Bank of Baroda has increased as compared to 2014. The graph shows that public sector banks have secured greater score than private sector banks it means public banks are financially sounder than private banks. Although private banks are in safe zone and their financial performance is satisfactory.

HYPOTHESIS TESTING

H0: null hypothesis banks are in financial distress and going to bankrupt within twelve months has been rejected while the alternative hypothesis has been accepted.

The calculated Z score indicates that each bank has got score more than 1.1. So banks are in safe zone. The average Z-score reveals that no banks are going to bankrupt, as all banks are financially healthy.

H’0: The second null hypothesis there is no difference between the performance of public sector banks and private sector banks has been rejected.

Alternative hypothesis has been accepted that there is difference between the performance of public sector banks and private banks. The greater score for public banks shows that public sector banks are financially sounder than private sector banks. Financial performance of public banks is better than private banks.

CONCLUSIONS

The prediction of business failure is very crucial for financial managers, analysts, investors and other users of financial statements.  Z score model is useful to estimate the financial soundness of any entity. The financial ratio is the most significant factor in bankruptcy prediction. In the present study it has been tried to know whether selected Indian banks are in distress zone or not.  The efficiency of Altman model has been highlighted in the present study. The study estimates Z score value for 10 Indian banks comprising five public and five private sector banks. Conclusively it has been witnessed that by using Altman model for a period of 5 years, all banks are financially sound as they all got Z value more than 2.60.There is difference between the financial performance of public sector banks and private banks as public banks have secured greater Z score value than private banks. This shows that the public banks are financially sounder than private banks (Deepak et al, 2014).   The attainment of greater performance would determine safe credit norms, better management of earnings, assets, capital that would easily absorb the risk exposure and ascertain the stability and long term survival of banks. The present study would help the banks to put themselves on the track of Basel-III. It can be concluded from the study that Edward Altman model is a useful tool for investors, managers and other stakeholders to predict the financial failure that can evaluate bankruptcy risk of organizations. The present study is expected to provide efficient framework to policymakers as well as bankers while making investment decision.

 

RECOMMENDATIONS

Based on the result and conclusion from the present study, the following recommendations should be given as a consideration to Indian banks for effective management and good performance. Basel norms should be given special concerns specially capital regulations that may strengthen the risk absorbing capacity of banks. In order to improve risk analysis practices, efforts should be made to strengthen the risk management system of banks. The adoption of sound management practice and corporate governance will definitely reduce the chance of bank failure. The special training efforts should be made to enhance the capabilities of staff members. Banks should not only rely on Altman model or financial ratios as a tool to predict bankruptcy but also other tools should be considered. Banks should identify and evaluate the factors that determine the probability of default. Banks should evaluate Z score on regular basis

 

SUGGESTIONS FOR FUTURE RESEARCH

In present study an attempt has been made to predict the bankruptcy in selected Indian banks using Altman model, One can use other tools to predict bankruptcy. The Altman model for bankruptcy prediction can be used in other sectors. This type of study can be explored in future studies as Bankruptcy risk puts bank in distress zone or leads to failure. Further research can be done to extent observation years or sample used. The research can be done on testing the efficacy of various bankruptcy risk models and compare them to find out the best model. The analysis of this study can be repeated for other economies using the same methodology.

 

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ANNEXURE

SBI                                                    in cr. 2015 2014 2013 2012 2011
Current assets 1543723.2 1385924.3 1208328.8 1017855.07 923371.44
Current Liabilities 137698.05 96412.96 95455.07 80915.09 105248.39
Total Assets 1910381.7 1695821.6 1470806 1254604.14 1118487.81
Net sales/Revenue 152397.07 136350.8 119657.1 106521.45 95525.58
EBIT 310817 32109 31081.72 31573.54 16291.89
Shares 746.57 746.57 684.03 671.04 635
Reserves and surplus 127691.65 117535.68 98199.65 83280.16 64351.04
Total Liabilities 1910381.7 1695821.6 1470806 1254604.14 1118487.81
WC 1406025.1 1289511.3 1112873.7 936939.98 818123.05
Z score 7.7212534 7.9346148 5.3237271 5.28509205 5.0843825
X1=working capital/Total assets 0.7359917 0.760405 0.7566421 0.74680128 0.7314546
X2=Retained earnings/Total assets 0.5519635 0.864619 0.0667659 0.06637963 0.05753397
X3=Earnings before interest and taxes/Total assets 0.1626988 0.0189342 0.0211324 0.02516614 0.014566
X4=Book value of equity/ total liabilities 0.0003907 0.0004402 0.0004651 0.00053486 0.00056773
           
PNB 2015 2014 2013 2012 2011
Current assets 448499.77 403214.66 345623.17 332395.67 280057.3
Current Liabilities 17204.89 15093.44 15019.15 13524.18 12328.27
Total Assets 603334 535326.47 463857.89 444669.82 365996.97
Net sales/Revenue 46315.36 43223.25 41893.33 39711.53 29804.4
EBIT 11955 11384 10907.37 7971.85 6901.45
Shares 371 362.07 353.47 339.18 316.81
Reserves & Surplus 38708.4 35533.25 32323.43 26028.37 19720.99
Total Liabilities 603334 535326.47 463857.89 444669.82 365996.97
WC 431294.88 388121.22 330604.02 318871.49 267729.03
Z score 4.964583 5.0812148 5.0614757 5.01625325 5.10196371
X1=working capital/Total assets 0.7148526 0.7250178 0.712727 0.71709722 0.73150614
X2=Retained earnings/Total assets 0.0433586 0.0556698 0.0696839 0.05853415 0.05388293
X3=Earnings before interest and taxes/Total assets 0.01981489 0.0212655 0.0235145 0.01792757 0.01885658
X4=Book value of equity/ total liabilities 0.0006149 0.0006764 0.000762 0.00076277 0.00086561
Bank of  Baroda 2015 2014 2013 2012 2011
Current assets 589793.9 540657.7 423288.6 361770.56 284836.83
Current Liabilities 22329.4 17811.5 14703.38 11400.46 9656.73
Total Assets 692659.15 641693.03 532432.06 435921.01 348740.45
Net sales/Revenue 42963.56 38939.71 35196.65 31981.84 23884.49
EBIT 9915.10 9291.03 8999.15 6774.61 5932.72
Shares 443.56 430.68 422.52 412.38 392.81
Reserves & Surplus 39391 35555 31546.92 27064.47 20600.3
Total Liabilities 692659.15 641693.03 532432.06 435921.01 348740.45
WC 567464.58 522846.25 408585.22 350370.1 275180.1
Z score 5.8062262 5.4614174 5.3416767 5.58040642 5.48436168
X1=working capital/Total assets 0.81925515 0.81479184 0.76739409 0.803746761 0.789068489
X2=Retained earnings/Total assets  0.0385537 0.00563796 0.05925060 0.062085721 0.059070578
X3=Earnings before interest and taxes/Total assets 0.01431454 0.01447893 0.01690196 0.015540912 0.017011849
X4=Book value of equity/ total liabilities 0.00064037 0.00067116 0.00079356 0.000945997 0.001126368
           
Canara Bank         2015 2014 2013 2012 2011
Current assets 395704.93 358452.04 288347.06 269245.23 249534.43
Current Liabilities 16629.66  14348.29 11325.45 8891.12 7804.64
Total Assets 531370.9  477573.56 401017.15 365269.07 328274.12
Net sales/Revenue 43750.04 39547.61 34077.94 32341.82 24470.09
EBIT 6950  6796.19 5890.01 4494.23 5062.76
Shares 475.20  461.26 443 443 443
Reserves & Surplus 31384.04  29158.85 24434.79 20181.82 17498.46
Total Liabilities 531370.9  477573.56 401017.15 365269.07 328274.12
WC 379075.27  344103.75 277021.61 260354.11 241729.79
Z score 5.4113341  5.4201194 4.83013057 4.939870957 5.109386324
X1=working capital/Total assets 0.7133910  0.7205251 0.69079741 0.712773491 0.736365663
X2=Retained earnings/Total assets 0.1945416 0.18307680 0.06093203 0.055251927 0.053304415
X3=Earnings before interest and taxes/Total assets 0.0130793  0.0142306 0.01468768 0.012303889 0.015422355
X4=Book value of equity/ total liabilities 0.0089429  0.0009658 0.00110469 0.001212805 0.001349482
         
           
Union Bank Of India 2015 2014 2013 2012 2011
Current assets 284841  257449.25 228551.35 197512.08 175292.53
Current Liabilities 9625.15  8313.29 7005.77 6799.95 7442.67
Total Assets 371990.78  345467.62 304855.04 255411.49 228541.78
Net sales/Revenue 32083.96  29349.39 25124.7 22383.89 17684.3
EBIT 5823.47  5218.10 5582.7 3688.65 3091
Shares 635.78  741.31 707.79 661.55 635.33
Reserves & Surplus 19125.10  17734.05 16588.39 12437.68 10555.35
Total Liabilities 371990.78  345467.62 304855.04 255411.49 228541.78
WC 275215.85  249135.96 221545.58 190712.13 167849.86
Z score 5.0826630  5.01542048 5.07020018 5.156779615 5.06228725
X1=working capital/Total assets 0.7398458  0.72115574 0.72672435 0.746685789 0.734438403
X2=Retained earnings/Total assets 0.0375089  0.05548580 0.05441403 0.048696635 0.046185647
X3=Earnings before interest and taxes/Total assets 0.0156548  0.01510445 0.01831264 0.014441989 0.013524879
X4=Book value of equity/ total liabilities 0.0017091  0.00214581 0.00232173 0.002590134 0.002779929
           
YES BANK      2015 2014 2013 2012 2011
Current assets 89246.21 67771.96 55898.54 45727.66 40045.72
Current Liabilities 7094.18 6387.75 5418.72 5677.28 2583.07
Total Assets 129076.23 102628.04 93685.4 67984.83 56423.92
Net sales/Revenue 11572.01 9981.35 8294 7123.71 4658.12
EBIT 3249.58 2687.97 2141.69 1514.07 1158.76
Shares 417.74 360.63 358.62 352.99 347.15
Reserves & Surplus 11262.25 6761.11 5449.05 4323.65 3446.93
Total Liabilities 129076.23 102628.04 93685.4 67984.83 56423.92
WC 82152.03 61384.21 50479.82 40050.38 37462.65
Z score 4.46992661 4.2198871 3.787987 4.1132064 4.5758533
X1=working capital/Total assets 0.63646133 0.5981232 0.5388227 0.58910759 0.66394979
X2=Retained earnings/Total assets 0.03747289 0.0357372 0.0292884 0.02869625 0.02327488
X3=Earnings before interest and taxes/Total assets 0.02517666 0.0261914 0.0228604 0.0222707 0.02053668
X4=Book value of equity/ total liabilities 0.003236 0.003514 0.0038279 0.00519218 0.00615253
 

ICICI

 

2015

 

2014

 

2013

 

2012

 

2011

Current assets 454823.74 412941.64 360754 309472.4 266803.5
Current Liabilities 31719.86 34755.55 32133.6 17576.98 15986.35
Total Assets 614409.44 559886.03 504661.1 456070.1 390247.3
Net sales/Revenue 49091.14 44178.15 40075.6 39906 32369.69
EBIT 19719.91 16594.57 13199.23 8401.8 6825.65
Shares 1159.66 1158.04 1158.12 1155.15 1152.11
Reserves & Surplus 79262.26 72051.73 65547.84 59250.09 53938.82
Total Liabilities 614409.44 559886.03 504661.1 456070.1 390247.3
WC 423103.88 378186.09 328620.4 291895.4 250817.1
Z score 4.8496924 5.1512714 4.873272 4.748529 4.787423
X1=working capital/Total assets 0.6886350 0.6754697 0.651171 0.640023 0.642713
X2=Retained earnings/Total assets 0.0351477 0.1591541 0.129885 0.129914 0.138217
X3=Earnings before interest & taxes/Total assets 0.0320957 0.0296391 0.026155 0.018422 0.017491
X4=Book value of equity/ total liabilities 0.0018874 0.0020683 0.002295 0.002533 0.002952
           
INDUSIND BANK 2015 2014 2013 2012 2011
Current assets 83098.97 64446.54 52896.21 42367.33 31488.57
Current Liabilities 3718.96 2718.73 2099.99 1810.8 1694.83
Total Assets 105396.9 84307.2 71206.52 55785.27 43941.01
Net sales/Revenue 9691.96 8253.53 6983.23 5942.39 4036.13
EBIT 3098.22 2595.96 1839.46 1230.88 915.67
Shares 543.50 536.66 533.58 478.65 473.95
Reserves & Surplus 10101.03 8506.3 7096.67 4043.72 3350.92
Total Liabilities 105396.9 84307.2 71206.52 55785.27 43941.01
WC 79380.01 61727.81 50796.22 40556.53 29793.74
Z score 5.1863573 5.4621881 5.186039 5.162787 4.847906
X1=working capital/Total assets 0.7531528 0.7321772 0.713365 0.727011 0.678039
X2=Retained earnings/Total assets 0.0131047 0.136657 0.099663 0.072487 0.07626
X3=Earnings before interest and taxes/Total assets 0.029395 0.0307916 0.025833 0.022065 0.020839
X4=Book value of equity/ total liabilities 0.0051566 0.0063655 0.007493 0.00858 0.010786
           
Axis Bank  2015 2014 2013 2012 2011
Current assets 327075.25 267286.2 224467.5 190176.4 168448.6
Current Liabilities 15055.67 13788.89 10888.11 8643.28 8208.86
Total Assets 446876.72 369456.99 329672.6 276984.5 234504.5
Net sales/Revenue 35478.60 30641.16 27182.57 27026.17 19343.63
EBIT 13385.44 11456.09 9303.13 6492.03 5368.27
Shares 474.10 469.84 467.95 413.2 410.55
Reserves & Surplus 44202.41 37750.64 32639.91 22395.34 18588.28
Total Liabilities 446876.72 369456.99 329672.6 276984.5 234504.5
WC 312019.58 253497.31 213579.4 181533.1 160239.8
Z score 4.8316456 5.1789229 4.763803 4.722019 4.896607
X1=working capital/Total assets 0.6982229 0.6861348 0.647853 0.655391 0.683312
X2=Retained earnings/Total assets 0.015001 0.1436104 0.099007 0.080854 0.079266
X3=Earnings before interest and taxes/Total assets 0.0299533 0.0310079 0.028219 0.023438 0.022892
X4=Book value of equity/ total liabilities 0.0010609 0.0012717 0.001419 0.001492 0.001751
           
KOTAK MAHINDRA BANK 2015 2014 2013 2012 2011
Current assets 74384.28 60993.85 54355.84 43649.7 33303.62
Current Liabilities 4857.97 3333.82 2789.81 2553.67 3032.36
Total Assets 101154.11 84251.48 80903.88 63112.8 47818.31
Net sales/Revenue 9719.87 8767.12 8042.49 7032.28 4739.06
EBIT 2997.45 2577.15 2156.61 1623.75 1170.93
Shares 386.18 385.16 373.3 370.34 368.44
Reserves & Surplus 13754.91 11889.93 9091.19 7610.41 6464.95
Total Liabilities 101154.11 84251.48 80903.88 63112.8 47818.31
WC 69526.31 57660.03 51566.03 41096.03 30271.26
Z score 4.7754552 5.3323753 4.731477 4.843714 4.766181
X1=working capital/Total assets 0.687330 0.68438 0.637374 0.651152 0.633047
X2=Retained earnings/Total assets 0.019457 0.194014 0.11237 0.120584 0.135198
X3=Earnings before interest and taxes/Total assets 0.029632 0.0305887 0.026656 0.025728 0.024487
X4=Book value of equity/ total liabilities 0.0038177 0.0045716 0.004614 0.005868 0.007705

 

Pyramids of Nuclear Power: Canada Poised Between a Splintered Anglo-American Atomic Partnership

Neville Sloane PhD

Independent Scholar

Abstract

 The scientific accomplishment to build an atom bomb during the Second World War was monumental, but, there is little published work that links the importance of Canada to the wartime Anglo-American atomic research projects, immediate post-war nuclear policies and defects.[i] Therefore, one is inclined to underscore Canada’s position in the atomic energy field as somewhat of little consequence. Canada’s membership of the ‘inner ring’ was derived from the fact that (1) it had been closely associated from the very start with nuclear research and the development of atomic energy, and, (2) the technological advances of atomic energy brought the the Arctic region into play.[ii] These factors set in motion a chain of events that piloted Canada into the thick of the post-war energy discussions on the future of the global nuclear system.[iii] As a United Nations/NATO member, both the American and British positions on nuclear policy were vital to Canada’s strategic defence and national interests.[iv] Thus, Canada was caught in a conflicting crossroad: how to maximize national security and minimize risks originating from their nuclear energy policies whilst trying to promote disarmament objectives. Therefore, this study will first seek to fit Canada back into the story of Anglo-American atomic diplomatic relations during the Second World War; secondly, it will appraise the direction of Canada’s nuclear policy and international control at the end of the war. This paper raises the question: Did Canada fulfil its obligations under the United Nations charter for the maintenance of international peace and security effectively?  Canada, an emerging voice in international politics, highly advocated for nuclear disarmament in the post-1945 era. There is an irony here. After the war, Canada, strengthened by the impetus of nuclear industrial developments, became ‘the uranium factory supplier of choice of atomic commodities to stable and unstable countries’.[v]

 

Keywords

Nuclear Power, Anglo-American Atomic Partnership, atomic research projects, international politics

Research Paper

The scientific accomplishment to build an atom bomb during the Second World War was monumental, but, there is little published work that links the importance of Canada to the wartime Anglo-American atomic research project, immediate post-war nuclear policies and defects. New interpretations of Canada’s participation in campaigns during the war continue to be popularized by Canadian historians – military history is understandably popular – while the story of Canada’s role in the interaction of Anglo-American science policy and diplomacy remains underexplored.[vi] Therefore, one is inclined to underscore Canada’s position in the atomic energy field as somewhat of little consequence. 

Of all the elements in post-war international relations, the field of nuclear diplomacy and the trappings of nuclear knowledge economy were the most novel as compared to situations in the past. As we come upon the 75th anniversary of the start of the Second World War, it presents a unique opportunity to exam the major diplomatic decisions, the Dominion of Canada, the youngest of the three English-speaking nations in the North Atlantic Triangle faced, as it became the atomic broker in the wartime Anglo-American venture to build the first atomic bomb.[vii] This study will first seek to fit Canada back into the story of Anglo-American atomic diplomatic relations during the war; secondly, it will appraise the direction of Canada’s nuclear policy and international control at the end of the conflict.

It has been reported that Canada was essential to the Anglo-American nuclear research project mainly because of its supply of uranium and heavy water.[viii] The records available now suggest a different version of Canada’s involvement in the atomic partnership.[ix] As it was, Canada’s potential supply of uranium and heavy water constituted only ‘a limited ticket of admission’ to high stakes of atomic diplomacy.[x] Therefore, this raises the question: Why did the United States and Britain consider it important to bring Canada, a country that “ranked third in world production of uranium” and one that did not intend to become a nuclear power, into the maverick project conducted under a cone of secrecy?[xi]

American and British interests in Canada can be broadly categorized under three headings: commercial, political, and defence. That said, Canada had two suitors: first, the United States, recognizing the importance of Canada’s proximity to the Arctic region as an important area of mining and international defence strategy, especially in future security challenges, could not close its doors to Canada if it wanted Ottawa to follow Washington’s global manual on international politics. In the broadest sense, Canada’s geographic position, with its east-west expanse from both coasts, to its northern Arctic territories, made it vital to North America’s security.[xii] Secondly, Britain, unable to get the steering committee machinery set up with the Americans in 1942 looked to Canada, a treasure house of natural resources and expanding manufacturing facilities, to provide a counter balance to the Americans’ thrust to control the development of the atomic bomb, and to prevent the Americans from getting all the patents arising from heavy water research.[xiii] In its definition of atomic policy, for Britain, Canada’s membership in the North Atlantic Triangle, its proximity to the Arctic region, and its liaison with the United States (defence and trade) set up by the Ogdensburg Agreement of 1940 that paved the way for Canada’s participation in the atomic project, and the Hyde Park Agreement of 1941 provided the best mechanism for promoting British commercial, political and defence interests.[xiv] Taken together these interests represented the diverse ways Canada was linked to the United States and Britain, which allowed the Canadian government to act as a de facto mediator and exercise influence quite out of proportion to its power. But the events themselves were much more complex, steeped in history, and rife with contradiction.

 

In 1940-41 the British were well ahead of the Americans in theoretical nuclear research, however, the ‘pot-bellied financiers, with their limitless powers of production … aided by their far-superior resources …, left the British ruthlessly floundering,’ noted Winston Churchill.[xv] Americans perceived the British wanting to ‘cash in cheaply on an immense American enterprise; the British, on the other hand, perceived the Americans as seeking to establish a military and industrial monopoly in the atomic field.’[xvi] This became a vexed issue in Anglo-American relations, prompting complaints by British atomic policy-makers in the winter of 1943.

With a breakdown in the talks near certain, the question became the course of future events. On the main point—sharing of information—there could now be little doubt; American President Franklin D. Roosevelt’s administration was not prepared to meet contractual obligations of the Casablanca and Trident Agreements of 1943.  The challenging question for the Canadian Prime Minister, William Lyon Mackenzie King, was: should Canada support Britain and limit resources to the United States? Having positioned himself as a link between the two western atomic allies, King, the first Canadian prime minister to be involved in nuclear developments, had a simple, economical, and resolute manner of dealing with this matter. In the absence of any serious negotiating process, King, long irritated by what he saw as American foot-dragging in atomic discussions, and Britain’s inability to reconcile the conflicting interpretations of the agreements, decided in May 1943, that unless they reached an understanding, Canada “would withdraw from the Montreal project”.[xvii] So, King, C. D. Howe, minister of munitions and supply, responsible for the Canadian atomic project, reminded Britain, first, that they were using some of the “Billion Dollar Gift and Mutual Aid Fund” to finance their part of the Anglo-Canadian Montreal atomic research project.[xviii]  In dealing with the American atomic monopolists, King, a crafty negotiator, used the Eldorado uranium production, access to Canada’s large water resource, admittance to mining and defence centres in the North as leverage to bargain for exchange of information. Afterwards, the Montreal team gained admission to the Chicago Metallurgical Laboratory working on the erection of U-235.[xix]

To pool scientific resources and to ensure continued collaboration after the war, Roosevelt and Churchill signed the Quebec Agreement in the summer of 1943.[xx] However, American verbal assurances of cooperation served as delay tactics to string the British along as the Manhattan project moved forward and overtook the Montreal based Anglo-Canadian atomic venture. [xxi] Soon after, the Anglo-American atomic partnership was in disintegration. By 1945, the Americans had built and tested the atomic bomb; the British, in the hope of gaining access to the fruits of atomic technology and data, surrendered the right to veto American use of atomic weapons.[xxii] Furthermore, the restrictive policies of the McMahon Act of 1946 made it difficult for Britain to expand its nuclear research to the dominions. [xxiii] With the exception of Canada ‘Washington’, in the words of historian Wayne Reynolds, ‘unswervingly opposed a separate British atomic programme and, with it, the possible development of projects in the dominions’.[xxiv]

 

When the moment of victory over Japan passed, the whole matter of international relations relating to atomic energy and nuclear disarmament talks was ‘in a thoroughly chaotic condition’.[xxv] The time had come for Canada to consider more permanent questions about future atomic policy. The advent of nuclear weapons and the requirements of the air defence control systems demanded rapid decisions to keep pace with the speed and tempo of technological advances. As a United Nations member, both the American and British positions on nuclear policy were vital to Canada’s strategic defence and national interests.[xxvi] In the great nuclear scramble, Canada, an emerging voice in international politics, was caught in a conflicting crossroad: how to maximize national security and minimize risks originating from their nuclear energy policies whilst trying to promote disarmament objectives. [xxvii]

 

 

The early post-war years were a time of turmoil and transition in Canada’s defence policy. The troubles were caused by a disparity between the ends and means.  It was a painful process, largely because policy-makers were unclear about the way to proceed and the means of ensuring Canada’s sovereignty in the North, its military contribution to its North American and North Atlantic alliances. Hence, ‘the Liberal government attempted a balance: a very close cooperation with the United States, including reciprocal access to military facilities, in the hope of retaining Washington’s broader good will in defence collaboration. [xxviii] As a result, Canada, next door to a nuclear power house, tended to refrain from any serious deviation from American defence and nuclear disarmament policies. As a trade-off for access to nuclear technology and defence, Canada subordinated its foreign policy to the United States ‘to maximize security and minimize risks’ originating from American nuclear policies.[xxix] In the words of Sean Maloney, ‘Canadian strategic policy up to 1951 was geared to the short term and reactive by nature.’[xxx]

American post-war nuclear energy agenda and their Arctic defence policy exposed Canada to American political and military interference and their economic imperialism.[xxxi] Indeed, the dependence, a military one, became increasingly economic and cultural. Canada’s orientation towards the United States did not imply a rejection of Britain, it derived, somewhat, from Canada’s recognition that it could no longer rely solely on Britain for security or trade.

In an attempt to control the use of atomic energy in the post-war world, Canada joined United Nations international initiatives and entered defence alliances, for example, the North Atlantic Treaty Organization (NATO) in 1949 to solve the problems of security and to counter the growing threat of the Soviet Union.[xxxii] The creation of Canada’s long-term alliance commitment to NATO, however, ‘was a reactive defense policy’.[xxxiii] On the international scene, Canada’s status of middle power between East and West allowed it to assume the role of a global pace setter of peacekeeping missions. But did Canada, an emerging voice in international politics, fulfil its obligations under the United Nations charter for the maintenance of international peace and security effectively?

In the post-1945 era, Canada, an industrially growing nation, highly advocated for nuclear disarmament. However, if we look at execution, Canada is far away from the goals it defined. Canada’s stance toward the Non-Proliferation Treaty of 1968, extended indefinitely in 1995, to prevent the spread of nuclear weapons, to which it was a signatory, is mixed.[xxxiv] Despite intentions, Canada’s commitment to disarmament has been timid. A very strong argument can be made that Canada is a contributor to the arms race! When Canada made the transition to the expanding nuclear reactor market, it became ‘the uranium factory supplier of choice of atomic commodities to stable and unstable countries’ ready to build tactical nuclear weapons.[xxxv] Canada, competing for profitable contracts, sold nuclear knowledge and nuclear reactors to India, Pakistan, Iran, Iraq and North Korea, to name a few countries, with the naïve belief that they couldn’t secretly use the reactors to build nuclear bombs. The United States and Britain are not without spots. During the second Cold War period Britain and the United States supplied weapons of mass destruction to Jordan, Israel, Iraq and Iran, thus escalating an arms race in the Middle East. This led to a tense period of nuclear neighbours ready for war.[xxxvi] This situation still exists today.[xxxvii]

Canada is ‘the initial source of substantial amounts of the depleted uranium DU now used routinely in modern “conventional” weaponry.’ Some of the DU bombs, used during the Iran-Iraq war of 1980-88, had their source in the Saskatchewan North. According to the World Nuclear Association records, in 2008 Canada exported ‘7, 330 tonnes’ of uranium.[xxxviii] The Canadian Press recently reported that Canada has increased since 2011 nuclear weapons exports to Bahrain, Algeria, Iraq, Pakistan, and Egypt.[xxxix] To be sure, countries with access to nuclear technology and uranium CANDU reactors can gain nuclear capacity.

By way of summation then, the relationship between weapons technology and diplomatic policies during the war was seen by the United States, Britain, and Canada as a means of controlling the course of international affairs. This unchallenged expectation rested on the assumption that the bomb would have no limitations as a diplomatic weapon. It was not the discovery of nuclear fusion that has brought us to nuclear power posing considerable threat to national security but the economic and political development that went hand in hand with atomic power.[xl] Ultimately, their inability to create a seamless co-ordination of atomic energy policy to meet security interests fostered post-war nuclear tensions.[xli] This, in part, lies at the root of the nuclear trauma during the second Cold War period and the universal security challenges gripping the world today as Iran and North Korea refuse to reign in their nuclear programmes. The use of nuclear weapons knows no ethnic, religious, or political boundaries. The damage done to

[i] Brian Villa, in his article “Alliance Politics and Atomic Collaboration, 1941-1943” The Second World War as a National Experience (Ottawa, 1981; Sidney Astor, ed.) looked mainly at the genesis of the atomic project. Two historians, David G. Haglund and Joel J. Sokolsky limited their work to the American-Canadian defence relationship. David Holloway, Stalin And The Bomb: The Soviet Union and Atomic Energy, 1939-1956 (New Haven, 1994). Holloway’s extensive study only notes that Canada had uranium deposits that in part helped speed up Soviet atomic research, 105, 129. Also, see, John Charmley, Churchill’s Grand Alliance: Anglo-American Special Relationship 1940-57 (London, 1995); David Stafford, Roosevelt & Churchill: Men of Secrets (London, 1999); Septimus H. Paul, Nuclear Rivals: Anglo-American Atomic Relations, 1941-1952 (Columbus, 2000). Important Canadian documents and letters are: LAC Mackenzie Diary (9 June, 1942), King Diary (15 June, 1942); LAC Charles J. Mackenzie Diary, 9 June & 29 September, 1942, NRC Vol. 284.

[ii] TNA PREM.3 139/9, ‘Collaboration between UK, USA and Canada: Action Recommended to Operate the Anglo-American Agreement,’ 9 October 1943; LAC Howe Papers, S-8-2 vol. 13, Canadian Member, Combined Policy Committee, to Minister of Munitions and Supply and of Reconstruction, 10 August 1945. Also, see: Peter Boyle, ‘The Special Relationship: an Alliance of Convenience?’ Journal of American Studies 22 (December 1988), 457-65; Timothy J. Botti, The Long Wait: the Forging of the Anglo-American Nuclear Alliance, 1945-1958 (New York, 1987), 25-6; Michael Byers, Who Owns the Arctic: Understanding Sovereignty Disputes in the North (Vancouver, 2009).

[iii] For information on post-war issues of atomic energy, see: Ernie Regeht and Simon Rosenblum, Canada and the Nuclear Arms Race (Halifax, 1983); D. E. Lilienthal (Chairman of the Tennessee Valley Authority), The Journals of David E. Lilienthal II (New York, 1964); Benjamin P. Greene, Eisenhower, Science Advice, and the Nuclear Test-Ban Debate, 1945-1963 (Stanford, CA, 2007). For Canada’s membership on the Combined Policy Committee, see: LAC Howe Papers, MG 27111 Vol. 47 Folder S-11-4:2, Howe to [H. J.] Carmichael, 24 August 1943; LAC Howe Papers, MG 27111, B20 Vol. 13, Canadian Member, Combined Policy Committee, to Minister of Munitions and Supply and of Reconstruction, 10 August 1945; TNA PREM 3/139/8A-316, Churchill to Roosevelt, 15 August 1943; Ibid, Anderson to Prime Minister, 13 August 1943; Robert Wolfe, “Canada’s Adventures in Clubland: Trade Clubs and Political Influence,’ Canada Among Nations 2007: What Room for Manoeuvre? (Montreal, 2008; Jean Daudelin and Daniel Schwanen, eds.), 181-197.

[iv] TNA CAB 126/276 C403480, 10 November 1945; TNA PREM 8/466 C 403480, (NOCOP ZO 152), 6 February 1947, Field Marshal Wilson to General Hollis. Document refers to the question of standardization of armaments in early 1947; Disarmament Treaty 1954: TNA FO 371/112387 C516117 (UP 232/3000) United Nations Political Department (UP) from Foreign Office to United Nations Pol[itical] dept[artment] dated 4 June 1954 received in registry, 10 June 1954. References to later relevant papers are: UP 232/301 and 302; TNA CAB 129 /92 C (58)77, copy 46, 218 F, 10 April 1958. For a comprehensive analysis of the House of Commons Foreign Affairs Committee (HCDAC) report entitled ‘Global Security: US-UK relations’, released on the 70th anniversary of the Destroyers-for Bases deal, see: Steve Marsh, ‘Global Security: US-UK relations’: lessons for the special relationship? Journal of Transatlantic Studies Vol. 10 No. 2 (June 2012), 182-99. Also, see: William Lee Miller, Two Americans: Truman, Eisenhower, and A Dangerous World (New York: 2012), 184; LAC Mackenzie Diary (9 June, 1942), King Diary (15 June, 1942); LAC Charles J. Mackenzie Diary, 9 June & 29 September, 1942, NRC Vol. 284.

[v] Neville Sloane, ‘The North Atlantic Triangle: Anglo-American-Canadian Atomic Diplomacy, 1941-45’, Paper presented at the Trans-Atlantic Studies Association Conference, The University of Dundee, Scotland, 14 July 2011. The trail of uranium sales runs to Britain, America, Russia, France, Israel, India, Pakistan, and Communist China.

[vi] Sean Cadigan: Death on Two Fronts: National Tragedies and the Fate of Democracy in Newfoundland, 1914-34 (Toronto, 2013). Cadigan, tells the story of Newfoundland’s part in the First Word War; David J. Bercuson: The Patricias: a Century of Service (Fredericton, 2013). Bercuson Canada’s foremost military historian- Canada’s foremost military historian professor David Bercuson tells the tale of The Patricias, a famous infantry battalion raised in 1914, became part of the 2nd Canadian Division after the Second Battle of Ypres. Ted Barris, The Great Escape: A Canadian Story (Markham, ON, 2013). Barris concentrates on the intricate prison break in March 1944, orchestrated by Canadian airmen, from Stalag Luft III prisoner- of –war camp,

[vii] For discussions on the secret Anglo-American atomic scheme, David Stafford, Roosevelt & Churchill: Men of Secrets (London, 1999). For background on the formation of the North Atlantic Triangle, see: John Bartlet Brebner’s classic study North Atlantic Triangle: The Interplay of Canada, the United States and Great Britain (New York, 1958/original 1945), 244-72. For a useful review of issues raised by Brebner, see: Gordon Stewart, ‘What North Atlantic Triangle,’ London Journal of Canadian Studies 20: 2004/2005, 5-25. LAC Chalmers Jack Mackenzie Diary [henceforth: Mackenzie Diary), 9 June 1942.

[viii] C.P. Stacey, Arms, Men and Governments: The War Policies of Canada, 1939-1945 (Ottawa, 1974), 514; Robert M. Hathaway, Great Britain and the United States: Special Relations since WWII, (Boston, 1990); Richard Rhodes, The Making of the Atomic Bomb, (New York, 1986); Jim Harding, Canada’s Deadly Secret: saskatchewan uranium and the global nuclear system [henceforth: Canada’s Deadly Secret ] (Halifax, 2007), 20. It has been said that Canada had not supplied the uranium used for the bomb dropped on Hiroshima; in fact, records show the uranium ‘came from the Port Radium mine in the Northwest Territories.’

[ix] Villa, 140. An accurate view of the situation given by C. J. (Dean) Mackenzie, acting president of the National Research Council, to Hume Wrong at the External Affairs Department after the war is worth quoting: “The American project, on the other hand, was not entirely dependent on Canadian ore as they had stockpiled a great deal of the Belgium Congo material’. Indeed, prior to 1943 the Congo production could supply ‘6, 500 tons of high grade ore’ compared to ‘690 tons of medium and low grade ore’. This was increased by 1943 to 145 tons per month. Harding, Canada’s Deadly Secret, 20. It has been said that Canada had not supplied the uranium used for the bomb dropped on Hiroshima; in fact, records show the uranium ‘came from the Port Radium mine in the Northwest Territories.’ Ibid.

[x] LAC National Research Council (NRC) RG 77 Vol. 284; Villa, 110. Robert Bothwell and William Kilbourne, C.D. Howe: A Biography (Toronto, 1979), 169.

[xi] Based on the Library and Archives Canada (LAC) National Research Council (NRC), RG 77 Vol. 284 record, Canada ranked third in world production of uranium after the Belgian Congo and the United Sates.

[xii] Canada works closely with the US in monitoring northern airspace across northern Canada and Alaska. Since 1957, Canada along with the US maintains a line of long range warning stations, known as the Distant Early Warning Line, or DEW line in order to provide warning of an attack over the North Pole.  In the late 1980s, the original line was replaced with more advanced equipment, including satellite monitoring systems.

[xiii] Margaret Gowing, Britain and Atomic Energy, 1939-45 (London, 1964), 123-132. Canada had bilingual professional scientists in many fields who could work with those Free-French scientists who had access to heavy water from Norway in 1939-1940 and who later joined the Montreal team in 1943.

[xiv] Paul Reynolds, ‘The Arctic’s New Gold Rush,’ BBC News, 25 October 2005, op. cit, Library of Parliament , Parliament of Canada, Canadian Arctic Sovereignty, Mathew Carnaghan, and Allison Goody, Political and Social Affairs Division, PRB 05-61E, 26 January 2006. According to the US Geological Survey, ‘the Arctic contains an estimated one-quarter of the world’s undiscovered energy resources.’ Pierre Pettigrew, Speech, ‘Canada’s Leadership in the Circumpolar World,’ 22 March 2005, op. cit, Library of Parliament,  Parliament of Canada , Canadian Arctic Sovereignty Mathew Carnaghan, and Allison Goody, Political and Social Affairs Division, PRB 05-61E, 26 January 2006. As part of NORAD, Canada maintains unmanned radar sites, the North Warning System (NWS). The Canadian Forces Northern Area (CFNA) comprising of 65 regular force, reserve and civilian personnel is headquartered in Yellowknife. Canada needs more icebreakers in order to properly patrol the area within the Arctic ice. Another area of concern is the Northwest Passage (see article on Baffin), which runs through the Arctic islands. Baffin Island, Canada’s largest island is named after the English navigator William Baffin who sailed in search of the Northwest Passage in 1615-1616.  Canada claims these waters; the United States and maritime powers claim that the Northwest Passage is an international strait. Disputes of this nature are not uncommon. Canada and the United States have disputed the maritime boundary in the Beaufort Sea, an area that has potentially has oil and gas resources. Canada government has issued many policies documents since 1995 but policy initiatives directed towards the assertion of Canada’s sovereignty over its Arctic territory have tended to ebb and flow. Sovereignty is linked to the maintenance of international security and thus territorial control. That said, Canada is struggling to secure territorial control to monitor the passage and ensure compliance with Canadian sovereignty claims in the Arctic. The border between Canada and the United States in the Beaufort Sea, and thus ownership of Arctic waters, is being contested.

[xv] Michael Wardell, ‘Churchill’s Dagger: A Memoir of Capponcina,’ Chartwell Bulletin, 2, accessed at http://www.winstonchurchill.org/learn/reference/churchill-and/676-churchills-dagger-a-memoir-of… on 25 February 2014-Chartwell Bulletin, also available in The Atlantic Advocate published February 1965. After the war, Brigadier Wardell moved to Canada and looked after Beaverbrook’s affairs.  This quote is based on Wardell’s memoir and his recollections of his conversation with Churchill at Beaverbrook’s’ villa. No other record to date of Churchill’s comment is found in Beaverbrook’s files. For a review of the British MAUD project, see: Gowing, Britain and Atomic Energy, 1939-45. The MAUD Report is reproduced in Appendix II, 394-436.  Also, see: www. atomicarhive.com , retrieved 20 August 2011.

[xvi] Frank Costigliola, Roosevelt’s lost alliances: how personal politics helped start the cold war (Princeton, 2012). Roosevelt’s high stakes kept close control over the atomic bomb and post-war economic aid’, 13.

[xvii] LAC Mackenzie Diary, 1 May 1943.

[xviii] LAC Howe Papers, 24 August, 1943, MG 27111, Vol. 47, Folder S-11-4-2, Howe to H. J. Carmichael; TNA FO 954/4 507(5)508, (originally marked 1947-1948), Canada’s War Effort, J. L. Garner to V. G. Lawford for the Foreign Secretary, Anthony Eden, 2 March 1943.

[xix] TNA ABI 58, 5 February 1944, Chadwick to Appleton.

[xx] TNA PREM 3/344/2 fos. 151-6. Note: Both the United States and Britain violated the Quebec Agreements of 1943 and 1944. Under the Lend-Lease Act of 1941 United States sold uranium to the Soviets. Summary of the sales of uranium may be found in: Joint Committee on Atomic Energy, US Congress, Soviet Atomic Espionage, Washington, DC: US Government Printing Office, 1951, 185-92. More detailed evidence is presented in US Congress, House Committee on un-American Activities, Hearings Regarding Shipment of Atomic Material to the Soviet Union during World War II, Washington, DC: US Government Printing Office, 1950, 941. Also, see: Robert S. Norris, Racing for the Bomb: General Leslie. R. Groves, The Manhattan Project’s Indispensable Man (South Royalton, VT., 2002), 331-32. The British sold technical data to the French.

[xxi]Graham Farmelo, Churchill’s Bomb: A Hidden History of Science, War and Politics (London, 2013), 226. References to the Manhattan Project is mainly based on the three wartime agreements filed at The National Archives (TNA) PREM 3/139/11A. 1945-Explosives; Library and Archives Canada (LAC) Howe Papers MG 27 II B20 Series S-8-2, Vol. 7-16, (1942-1944); Atomic Energy, CD Howe, Vol. 15, Department of External Affairs (DEA) DCER Vol. XI, John F. Hilliker, (ed.), Chapter V.  In 1944 Canada had to remind the American atomic policy-makers of the Quebec Agreement; thereafter, the Montreal team gained access to the Chicago Metallurgical Laboratory in “the field of engineering research development” for the erection of U-235.TNA ABI 58, 5 February, 1944, Chadwick to Appleton.

[xxii] TNA PREM 3/139/8A-316, Churchill to Roosevelt, 15 August 1943; TNA ABI/58, Chadwick to Appleton, 5 February 1944; TNA PREM 3/139/9, 26 July 1945. Also, see: Henry Adams, Harry Hopkins: A biography. (New York: 1977), p. 166;  LAC Howe Papers, 10 August, 1945, S-8-2 Vol.13, Canadian Member, Combined Policy Committee, to Minister of Munitions and Supply and of Reconstruction; Foreign Relations of the United States series (Washington, 1972), FRUS 1946, I: 1250.

[xxiii] Internal US government discussions reflected a determination to resist any British attempts to improve their nuclear capabilities in the post-war period. British government files show British irritation and frustration at American policies, even whilst acknowledging the extent of US leverage. For British Cabinet discussions on the future of Anglo-American alliance, possible courses in weapons programmes, reliance on American ‘goodwill’, see: TNA CAB C (60)129 Copy 54 91, July 1960. For a study covering American post-war nuclear policy, see: Lawrence Freedman, The Evolution of Nuclear Strategy (London, 2003, 3rd ed.).

[xxiv] Wayne Reynolds, ‘Australia’s Middle-Power Diplomacy and the Attempt to Join the Atomic Special Relationship, 1943-1957’, Parties Long Estranged: Canada and Australia in the Twentieth Century (Vancouver, 2003; Margaret MacMillan and Francine McKenzie, eds.), 169; TNA CAB 126/276 C 403480, Note of a Meeting of the United Kingdom Delegation held at the White House, 10 November 1945. Prime Minister C.R. Attlee chaired the meeting. LAC Department of Munitions and Supply, MG27-III-20 Vol. 14 File S-8-2-32 ‘Tube Alloys’ 1942-1944 & Vol. 50 File S-11-4-2 ‘Combined Production and Resources Board’,  1943-46.

[xxv]Martin J. Sherwin, A World Destroyed: The Atomic Bomb and the Grand Alliance (New York, 1977), op. cit., 238. At the London Foreign Minister’s Conference in September 1945, Molotov engaged in a strategy of reversal atomic diplomacy underplaying the importance of the atom bomb in post-war diplomacy. Possessing the bomb did not promote ‘American post-war aims’. Sherwin posits. Also, see: Gregory, F. Herken, ‘American Diplomacy and the Atomic Bomb, 1945-1947’, (unpublished doctoral dissertation, Princeton University, 1973), 97-146.

[xxvi] For information on post-war issues of atomic energy, see: Ernie Regeht and Simon Rosenblum, Canada and the Nuclear Arms Race (Halifax, 1983); Benjamin P. Greene, Eisenhower, Science Advice, and the Nuclear Test-Ban Debate, 1945-1963 (Stanford, CA, 2007); TNA PREM 3/139/8A-316, Churchill to Roosevelt, 15 August 1943; Ibid, Anderson to Prime Minister, 13 August 1943; Robert Wolfe, “Canada’s Adventures in Clubland: Trade Clubs and Political Influence,’ Canada Among Nations 2007: What Room for Manoeuvre? (Montreal, 2008; Jean Daudelin and Daniel Schwanen, eds.), 181-197.

[xxvii] TNA CAB 126/276 C403480, 10 November 1945; TNA PREM 8/466 C 403480, (NOCOP ZO 152), 6 February 1947, Field Marshal Wilson to General Hollis. Document refers to the question of standardization of armaments in early 1947; Disarmament Treaty 1954: TNA FO 371/112387 C516117 (UP 232/3000) United Nations Political Department (UP) from Foreign Office to United Nations Pol[itical] dept[artment] dated 4 June 1954 received in registry, 10 June 1954. References to later relevant papers are: UP 232/301 and 302; TNA CAB 129 /92 C (58)77, copy 46, 218 F, 10 April 1958. Also, see letters: LAC Mackenzie Diary (9 June, 1942), King Diary (15 June, 1942); LAC Charles J. Mackenzie Diary, 9 June & 29 September, 1942, NRC Vol. 284.

[xxviii]Brian W. Tomlin, Norman Hillmer and Fen Osler Hampson, Canada’s International Policies: Agendas, Alternatives, and Politics [henceforth: Canada’s International Policies] (Canada [Oxford University Press], 2008), 102.

[xxix] For a general discussion on weapons policies, see: John R. Walker, British nuclear weapons and the test ban, 1954-73: Britain, the United States weapons policies and nuclear testing: tensions and contradictions (Farnham, Surrey, 2010).

[xxx] Sean Maloney, Learning to Love the Bomb: Canada’s Nuclear Weapons during the Cold War (Washington DC: Potomac Books, 2007), 13, 1.

[xxxi]‘Development of the Arctic has become an international concern’, The Globe and Mail, 17 October 2013.

 C.P. Stacey, Canada and the North Atlantic Triangle, (Toronto, 1976), Chapter II; Donaldson, The Prime Ministers of Canada, (Toronto, 1997), 226. The Hyde Park Agreement had opened the door to American ownership of Canadian industry, which by the mid-1960s moved up to ‘60%’, and by the 1970s ‘nine out of 10 big plants’ were under the control of American parent companies.For a recent assessment of American ownership of Canadian mineral resources after the Second World War, see: Gordon Stewart, ‘“An Objective of US Foreign Policy since the Founding of the Republic’: The United States and the End of Empire in Canada”’, Canada and the End of Empire. (Vancouver, 2005; Phillip Buckner, ed.), 94-116.

[xxxii] Tomlin, Hillmer and Hampson, Canada’s International Policies, op. cit., 102. Generally, see: Carl B. Feldman and Ronald J. Bee, Looking the Tiger in the Eye: Confronting Nuclear Threat (New York, 1985).

[xxxiii] For discussions on nuclear disarmament and NATO, TNA CAB CC(62) 39, 3 May 1962. For a comparative assessment of the experiences of the Cold War linked to “the global war on terrorism”. Lowell H. Schwartz, Political Warfare against the Kremlin: US and British Propaganda Policy at the Beginning of the Cold War (Basingstoke, 2009).

[xxxiv] The Non-Proliferation Treaty of 1968, to prevent the spread of nuclear weapons, extended indefinitely in 1995, failed to subdue countries building weapons of mass destruction. For discussions on the topics above, generally, see: Michael Burns, ‘Have the Preventative Warriors Made US Safer?’ (University of Birmingham), hhtp://www.49th parallel.bham.ac.uk/back/issue14; Stephen J.K. Long, ‘The Origins of the CIA and the Non-Strategic Development of U.S. Political Warfare, 1946-47,’ 49th Parallel, vol. 24 (Spring 2010), 1-22 – http://www.49th parallel.bham.ac.uk/back/issue24; Miranda A. Schreurs, Henrik Selin, and Stacey D. VanDeveer (eds), Transatlantic Environment and Energy Politics: Comparative and International Perspectives (Farnham, Surrey, 2009).

[xxxv] Neville Sloane, ‘The North Atlantic Triangle: Anglo-American-Canadian Atomic Diplomacy, 1941-45’, Paper presented at the Trans-Atlantic Studies Association Conference, The University of Dundee, Scotland, 14 July 2011. In January 2012, North Korea, a nuclear-weapons state, tested some short range missiles, and soon after Iran refused to reign in its nuclear programme. The Globe and Mail, 12 January 2012. According to the World Nuclear Association records, in 2008 the country exported ‘7, 330 tonnes’ of uranium. The trail of uranium sales runs to Britain, America, Russia, France, Israel, India, Pakistan, and Communist China.

In 1958, after the American, Russian, and British once allies in arms-atomic tests had caused increasing radioactive fallout, a moratorium on further tests was accepted by the three powers in deference to world opinion. The accord broke down three years later, but in 1963 under the Nuclear Test Ban Treaty, the three powers agreed to hold underground tests only, thus avoiding the danger of atmospheric fallout. In 1968, they sought to discourage the further spread of nuclear arms among other nations, but neither France nor Communist China approved the non-proliferation plan. The Reykjavik Summit of 1986 failed to reach an agreement to eliminate nuclear weapons.

[xxxvi]TNA PREM 8/471 C403480, Cabinet Minutes, 11 February 1947. President Dwight D. Eisenhower, in May 1953, considered using nuclear weapons against North Korea. Generally, see: Chester J. Pach Jr. and Elmo Richardson, The Presidency of Dwight D. Eisenhower (Kansas City, 1991). In the early 1970s, President Richard Nixon extended arms sales short of nuclear weapons to both Iran and Saudi Arabia. The Soviet Union supplied Iraq with arms dangerously escalating the arms race. President Ronald Reagan’s administration promoted Israeli sales of American manufactured arms to Iran. Reagan might have placed a ‘ban on the sale of military equipment to both Iran and Iraq’ during the Iran-Iraq War of 1980-88, ‘but during the course of his presidency (1981-89), he and his advisers broke this ban by supplying arms to both nations … .’  According to Avi Shlaim, ‘… arms sales to Iran via Israel continued unchecked despite … Operation Staunch, a mid-eighties initiative by the Reagan administration to curb arms transfers to Iran. Avi Shlaim, War and Peace in the Middle East (New York, 1995), 75-7 and 45, 63. In the case of Iran, unlike in the past, it has been cooperating  in disclosing details of its nuclear programme. Senate Standing Committee on Foreign Affairs and International Trade, ‘Iran in Focus: Current Issues for Canadian Foreign Policy,’ December 2012, 6 at http:// www. http://www.senate-senat.ca/foraffetrang.org. Taken form DFAIT, 41:1, Issue no. 6, 47-8, 53-4; BBC News. 14 July 2015.

[xxxvii] During the research period for this paper, international tensions were rising when suicide bombers targeted security compounds in Syria; in neighbouring Lebanon rocket-propelled grenades caused panic in Sidon. The Moncton Times and Transcript reported on 24 June 2013 that ‘More than 93,000 people have been killed in Syrian conflict that started in March 2011’- the sectarian conflict in Syria ‘has spilled across Syria’s borders’. The very recent 26th Boston Marathon explosions, ‘loaded with horrible symbolism’, is hard to ignore’; The Globe and Mail security headlines: ‘Terror in Boston’, 16 April 2013. The fireball explosion at 2:50 pm along the final mile happened on 15 April 2013. In January 2012, North Korea, a nuclear-weapons state, tested some short range missiles, and soon after Iran refused to reign in its nuclear programme. The Globe and Mail, 12 January 2012. The BBC reported on 7 February 2016 that North Korea had more than 1,000 ballistic missiles of varying-range capabilities. The Taepodong-2 ballistic missile has a range of 8,000kms and can strike North America, the Middle East, and Asia. The North Koreans, as reported by the Canadian Broadcasting Corporation, on 23 June 2016, have been been condemned on two separate occasions, 1 June 2016 and  23 June 2016, by the United Nations Security Council for its testing of ballistice missiles. The New York Times, 22 June 2016, reported that the US Ambassador to the United Nations, Samantha Power, found the testing by North Korea to be “‘unacceptable’”.

[xxxviii] Harding, Canada’s Deadly Secret, 20. http://www.stratecoinc.com/en/uranium/hsitory-of-uranium-production-in-canada.php, retrieved 4 February 2014. Eldorado mines taken over from LaBine in 1942 C.D. Howe Eldorado became a Crown Corporation in 1943) major deposits of uranium discovered in Saskatchewan in the late 1940s. By the 1980s, Canada emerged as the world’s leading producer and exporter of uranium, with about 80% of its annual uranium production destined for export.’ According to the World Nuclear Association records, in 2008 Canada exported ‘7, 330 tonnes’ of uranium. The trail of uranium and nuclear technology sales also runs to America, Britain, Israel, India, Iraq, Pakistan, Russia, and Communist China. Generally, see: Gordon Edwards, ‘Canada’s Nuclear Industry and the Myth of the Peaceful Atom,’ Canada and the Nuclear Arms Race, (Toronto, 1983; Ernie Regehr and Simon Rosenblum, eds.). For a discussion of the spread of nuclear weapons during the 1990s to unstable countries, see: Jonathan Schell, The Seventh Decade: the New Shape of Nuclear Danger (New York, 2007).

[xxxix] The Globe and Mail, 9 December 2013.

[xl] During the research period for this paper, international tensions were rising when suicide bombers targeted security compounds in Syria; in neighbouring Lebanon rocket-propelled grenades caused panic in Sidon. The Moncton Times and Transcript reported on 24 June 2013 that ‘More than 93,000 people have been killed in Syrian conflict that started in March 2011’- the sectarian conflict in Syria ‘has spilled across Syria’s borders’. The very recent 26th Boston Marathon explosions, ‘loaded with horrible symbolism’, is hard to ignore’; The Globe and Mail security headlines: ‘Terror in Boston’, 16 April 2013. The fireball explosion at 2:50 pm along the final mile happened on 15 April 2013. In January 2012, North Korea, a nuclear-weapons state, tested some short range missiles, and soon after Iran refused to reign in its nuclear programme. The Globe and Mail, 12 January 2012.

[xli] After the Second World War, the United States and Britain also joined United Nations international initiatives to control the use of atomic energy. At the United Nations both governments supported the Baruch Plan of 1946 that advocated outlawing the use of the atom bomb for military use. Generally, see: Bernard M. Baruch, Baruch: The Public Years (New York, 1960); Carl B. Feldman and Ronald J. Bee, Looking the Tiger in the Eye: Confronting Nuclear Threat (New York, 1985), 106-7. There is an irony here. The Americans, and to a lesser degree the British, supplied munitions to France to help them re-establish their authority in Indo-China. TNA PREM 8/471 C403480, Cabinet Minutes, 11 February 1947. President Dwight D. Eisenhower, in May 1953, considered using nuclear weapons against North Korea. The only reason why the consideration was rendered moot was because of the armistice signed. In 1958, after the American, Russian, and British-once allies in arms- atomic tests had caused increasing radioactive fallout a moratorium on further tests was accepted by the three powers in deference to world opinion. The accord broke down three years later, but in 1963 under the Nuclear Test Ban Treaty the three powers agreed to hold underground tests only, thus avoiding the danger of atmospheric fallout.  The Partial Test Ban Treaty of 1963 was not signed by France or China; American and British plans to conduct tests went forward. Lowell H. Schwartz, Political Warfare against the Kremlin: US and British Propaganda Policy at the Beginning of the Cold War (Basingstoke, 2009).The Non-Proliferation Treaty of 1968, to prevent the spread of nuclear weapons, extended indefinitely in 1995, failed to subdue countries building weapons of mass destruction. For discussions on the topics above, generally, see: Michael Burns, ‘Have the Preventative Warriors Made US Safer?’ (University of Birmingham), hhtp://www.49th parallel.bham.ac.uk/back/issue14; Stephen J.K. Long, ‘The Origins of the CIA and the Non-Strategic Development of U.S. Political Warfare, 1946-47,’ 49th Parallel, vol. 24 (Spring 2010), 1-22 – http://www.49th parallel.bham.ac.uk/back/issue24; Miranda A. Schreurs, Henrik Selin, and Stacey D. VanDeveer (eds), Transatlantic Environment and Energy Politics: Comparative and International Perspectives (Farnham, Surrey, 2009). For a comparative assessment of the experiences of the Cold War linked to ‘the global war on terrorism’, see: Lowell H. Schwartz, Political Warfare against the Kremlin: US and British Propaganda Policy at the Beginning of the Cold War (Basingstoke, 2009).