Hafiz Saeed is convicted of using his charity organisations for funding a militant group. His lawyer says his conviction is linked to Pakistan's bid to escape Financial Action Task Force's grey list.
The escape of a notorious militant and the strong-arming of the state by a radical cleric has brought Pakistan's fight against militancy into question.
The move came days before a visit to Washington by Prime Minister Imran Khan, who has vowed to crack down on militant groups operating in Pakistan.
Around 1,500 candidates are backed by religious and hardline parties for the July 25 general elections. Some of these groups are political fronts for groups banned for anti-state activites.
Meanwhile, Islamabad has removed Muhammad Ahmed Ludhianvi, head of the sectarian Ahl e Sunnat Wal Jamaat (ASWJ) group, from its terror watchlist.
At a recent meeting of an international terrorist financing watchdog, Islamabad lost support of close allies China and Saudi Arabia, exposing the country to the risk of economic fallout.
The US push to put a motion to place Pakistan on a global terrorist-financing watchlist comes at a time when Washington itself is accused by NATO ally Turkey of supporting, arming and financing a terror organisation on Syria's northern border.
In his first tweet of the year, Trump pledges to put a stop to aid to Pakistan claiming the US has gotten nothing in return.
Hafiz Saeed designated a terrorist by the US Justice Department with a $10 million bounty on his head, was released on Friday.
Yogi Adityanath has likened Bollywood actor Shahrukh Khan to an alleged terrorist. He's also said Mother Teresa was part of a conspiracy to "Christianise" India.
Muslim cleric Hafiz Saeed founded a militant group blamed for the 2008 attack on Mumbai that killed 166. He is head of a charity listed as a terrorist organisation by the UN.
While announcing the decision to lift the travel ban on Cyril Almeida, Pakistan's Interior Ministry statement warns other journalists to "counter negative propaganda of the enemies of state".
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