Terrorism has negatively impacted Pakistan's economy in several ways over the past two decades. It has caused a rise in security spending and production costs, a fall in business confidence and foreign investment, and hampered GDP growth. Specific effects included increased government spending on non-productive security, a decline in exports and tourism, and a rising burden on society through greater disability and health spending. Macroeconomic indicators suffered and maintaining economic growth became increasingly difficult as resources were diverted to counterterrorism efforts.

1. Effects of terrorism on Pakistan’s Economy Students Lahore School of Economics