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Pakistan austerity drive coincides with reported push to increase terror funding

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New Delhi, September 18, 2026 (Yes Punjab News)

Pakistan’s government has reintroduced a series of austerity measures to conserve fuel and contain expenditure amid economic pressures, while Indian intelligence officials have alleged that Pakistan-based networks are simultaneously being directed to increase funding for terrorist organisations.

According to the officials, agencies including Pakistan’s Inter-Services Intelligence (ISI) have instructed front organisations and other funding channels to step up collections that could be routed to groups such as Jaish-e-Mohammed and Lashkar-e-Taiba.

The allegations come as Pakistan has tightened restrictions on government spending. Under measures announced on September 17, fuel allocations for official vehicles have been cut by 50 per cent for three months, while purchases of government vehicles and most durable goods have been prohibited. Foreign travel by officials has also been restricted, and official dinners, government-funded seminars, training programmes and conferences have been curtailed.

Markets, shops and shopping centres have been directed to close by 9 p.m., while restaurants, cafes and eateries can operate until 11 p.m., with certain essential services exempted.

Indian intelligence officials, however, allege that terror-financing channels have been expanded despite the economic constraints. They claim classified state-backed channels that funded around $125 million in the previous year could rise to about $150 million this year.

The officials further alleged that criminal networks, including drug traffickers, money launderers and gangs involved in kidnapping and extortion, had been asked to raise their contribution from an estimated $70 million to at least $100 million. Religious charities and other front organisations, which officials said traditionally contributed around $200 million, have also allegedly been directed to increase collections.

The intelligence assessment further points to Pakistan’s defence expenditure as a potential channel for indirect support to militant infrastructure. According to the source material, the defence allocation for the current fiscal year has increased from 16 per cent to 18 per cent, with the official budget put at around 1.01 trillion Pakistani rupees.

The officials alleged that part of such funding could be diverted towards building or maintaining terrorist infrastructure, although the specific diversion figures were not independently established.

The developments are being closely monitored by Indian security agencies, which have expressed concern over the potential implications for terrorist activity, particularly in Jammu and Kashmir, if groups such as Lashkar-e-Taiba and Jaish-e-Mohammed receive increased financial support.

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