In its annual 'Country Report on Terrorism', as mandated by the Congress, the State Department said the Mumbai attack mastermind and UN-designated terrorist Hafiz Saeed continued to address large rallies, although in February 2017 Pakistan proscribed him under relevant provisions of Anti-Terrorism Act.
"Although LeT is banned in Pakistan, LeT's wings Jamaat- ud-Dawa (JuD) and Falah-i-Insaniat Foundation (FiF) were able to openly engage in fundraising, including in the capital," it said.
The 2015 ban on media coverage of Saeed, JuD, and FiF continued and was generally followed by broadcast and print media, it said.
The report listed Pakistan as one of the safe havens of terrorism and said that numerous terrorist groups, including the Haqqani Network (HQN), the LeT and JeM continued to operate from Pakistani soil in 2016.
It said Pakistan did not take substantial action against the Afghan Taliban or Haqqani, or substantially limit their ability to threaten US interests in Afghanistan, although Pakistan supported efforts to bring both groups into an Afghan-led peace process.
The Haqqani network has carried out a number of kidnappings and attacks against US interests in Afghanistan. The group is also blamed for several deadly attacks against Indian interests in Afghanistan, including the 2008 bombing of the Indian mission in Kabul that killed 58 people.
India, it said, continued to experience attacks, "including by Maoist insurgents and Pakistan-based terrorists".
Indian authorities continued to blame Pakistan for cross-border attacks in Jammu and Kashmir, it said.
The Indian government continued to closely monitor the domestic threat from transnational terrorist groups like ISIS and Al-Qaeda in the Indian Subcontinent (AQIS), which made threats against India in their terrorist propaganda. A number of individuals were arrested for ISIS-affiliated recruitment and attack plotting within India, the report said.
According to the State Department, the Pakistani government did not publicly reverse its December 2015 declaration that neither JuD nor FiF is banned in Pakistan, despite their listing under UN sanctions regimes, although in January 2017, Pakistan placed both organisations "under observation" pursuant to Schedule Two of the Anti-Terrorism Act.
On November 11, Pakistan's National Counterterrorism Authority published its own list of banned organisations that placed JuD in a separate section for groups that are "under observation" but not banned.
Pakistan continued military operations to eradicate terrorist safe havens in the Federally Administered Tribal Areas, although their impact on all terrorist groups was uneven, it said.
In its report, the State Department said in 2016, India and the US pledged to strengthen cooperation against terrorist threats from groups including al-Qaeda, the ISIS, JeM, LeT and D-Company (Dawood Ibrahim's group), including through greater collaboration on designations at the UN.
The United States and India worked together to designate JeM leader Maulana Masood Azhar, although the listing was blocked in the UN 1267 Committee, the State Department said.
Other areas mentioned in the report as safe havens are Afghanistan, Somalia, the Trans-Sahara, Sulu/Sulawesi Seas Littoral, Southern Philippines, Egypt, Iraq, Lebanon, Libya, Yemen, Columbia and Venezuela.
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