From The Australian:
FOLLOWING the terror massacres in Mumbai, Pakistan may now be the single biggest state sponsor of terrorism, beyond even Iran. Yet it has never been listed by the US State Department as a state sponsor of terrorism.
In 1998, according to the 9/11 Commission Report, the State Department's counter-terrorism co-ordinator recommended listing Pakistan as a state sponsor of terrorism. Then secretary of state Madeleine Albright decided against it, saying it would destroy US influence in Islamabad. And that has been the dilemma of Western policy towards Pakistan ever since.
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My Comment: We should also remind ourselves that Pakistan has nuclear weapons that most in the world believes is the most negligent by far in providing security to this arsenal.