Abstract
The purpose of this study is to analyse the effects of the two major factors of terrorism and political instability on Pakistan’s economy. Pakistan’s involvement in US war with Afghanistan along with sectarian and ethnic conflicts, are the main sources of spreading terrorism in Pakistan. This situation became the major cause of slowing down economic growth in Pakistan. In this study the positive and negative impacts of terrorism have been presented. After Pakistan’s participation in war against terror, the flow of foreign aid picked up but this aid was not for the development projects, it was just for the defense purpose. Terrorism caused much uncertainties as well as destruction in the country. The burden of the largest number of IDPs in the history of Pakistan badly effected Pakistan’s economy. Terrorism is also a cause of closure of many industries in Pakistan. Pakistan’s security situation gave a bad impression to foreign tourists. Foreign aid could not recover all the losses which Pakistan had to face due to terrorism. Pakistan had need technological and economic assistance for promoting industries and institutions to uplift its economy. In spite of limited resources and weak economy, Pakistan has spent a huge sum on operation against the militants groups. Pakistan participation in Us war against terror put extra burden on Pakistan’s economy.

Asifa Khalid. (2020) Impact of Terrorism on The Economy of Pakistan, Journal of Pakistan Vision, Volume 21, Issue 1.
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