FILE - In this Oct. 27, 2011 file photo, Secretary of State Hillary Rodham Clinton testifies on Capitol Hill in Washington before the House Foreign Affairs Committee following her trip the week before to Afghanistan and Pakistan. Clinton notified Congress Friday, Sept. 7, 2012, that the Obama administration has declared the Pakistan-based insurgent Haqqani network a terrorist body. The move, which bans Americans from doing any business with members of the group and blocks any assets it holds in the United States, could undermine Afghan peace efforts and test fragile U.S.-Pakistani relations. (AP Photo/Pablo Martinez Monsivais)
FILE - In this Oct. 27, 2011 file photo, Secretary of State Hillary Rodham Clinton testifies on Capitol Hill in Washington before the House Foreign Affairs Committee following her trip the week before to Afghanistan and Pakistan. Clinton notified Congress Friday, Sept. 7, 2012, that the Obama administration has declared the Pakistan-based insurgent Haqqani network a terrorist body. The move, which bans Americans from doing any business with members of the group and blocks any assets it holds in the United States, could undermine Afghan peace efforts and test fragile U.S.-Pakistani relations. (AP Photo/Pablo Martinez Monsivais)
FILE - In this Oct. 14, 2011 file photo, people in Lakki Marwat, Pakistan, attend the funeral of Maulana Iftikhar the day after he was killed alongside a top commander of the militant Haqqani network in a U.S. missile strike in nearby Miran Shah. Secretary of State Hillary Rodham Clinton notified Congress Friday, Sept. 7, 2012, that the Obama administration has declared the Pakistan-based Haqqani network a terrorist body. The move, which bans Americans from doing any business with members of the group and blocks any assets it holds in the United States, could undermine Afghan peace efforts and test fragile U.S.-Pakistani relations. (AP Photo/Ishtiaq Mahsud, File)
FILE- In this Aug. 22, 1998, file photo, Jalaluddin Haqqani, founder of the militant group the Haqqani network, speaks during an interview in Miram Shah, Pakistan. The Obama administration faces a weekend deadline to decide whether the Pakistan-based Haqqani network should be declared a terrorist organization, a complicated political decision as the U.S. withdraws from Afghanistan and pushes for a reconciliation pact to end more than a decade of warfare. (AP Photo/Mohammed Riaz, File)
WASHINGTON (AP) ? The Obama administration declared Friday that the Pakistan-based Haqqani network of militants is a terrorist body despite misgivings about how the largely symbolic act could further stall planned Afghan peace talks or put yet another chill on the United States' already fragile counterterrorism alliance with Islamabad.
Secretary of State Hillary Rodham Clinton's decision, signed Friday ahead of a Sunday deadline set by Congress, bans Americans from doing business with members of the group and blocks any assets it holds in the United States. The order, which will go into effect within 10 days, completes an odyssey of sorts for the Haqqanis from the days they partnered with the CIA during the Cold War and were hailed as freedom fighters.
Clinton, whose advisers were of two minds about whether the designation was the right path, said in a statement Friday that the U.S. will "also continue our robust campaign of diplomatic, military and intelligence pressure on the network, demonstrating the United States' resolve to degrade the organization's ability to execute violent attacks."
Enraged by a string of high-profile attacks on U.S. and NATO troops, Congress insisted Clinton deliver a report on whether the Haqqanis should be designated a terrorist organization and all of its members subjected to U.S. financial sanctions.
A subsidiary of the Taliban and based in the remote North Waziristan region of Pakistan, the Haqqani network is responsible for several attacks in Kabul, including last September's rocket-propelled grenade assault on the U.S. Embassy and NATO headquarters. American officials estimate its force at 2,000 to 4,000 fighters and say it maintains close relationships with al-Qaida.
U.S. defense officials said the administration doesn't believe the Haqqanis have designs to attack the United States. But they said the group shelters al-Qaida and other militant groups, allowing them to plan and train for possible operations targeting the U.S.
The U.S. already has sanctioned many Haqqani leaders and is pursuing its members militarily. But it resisted the terrorist designation because of worries that it could jeopardize reconciliation efforts between the U.S. government and insurgents in Afghanistan, and ruffle feathers with Pakistan, the Haqqanis' longtime benefactor.
"The only reservation ? and it's only a mild one ? is whether this complicates reconciliation at all," said Rep. Adam Schiff, D-Calif., a member of the House Intelligence Committee, said. "I see only a very small downside to the designation and that's more than offset by the financial pressure on the network."
Friday's decision also could complicate talks to free the only U.S. prisoner of war from the Afghan conflict, Army Sgt. Bowe Bergdahl, a 26-year-old from Idaho who has been held by the Haqqanis since 2009.
State Department spokesman Patrick Ventrell dodged questions about reported Haqqani threats to further mistreat Bergdhal as a result of the designation but said the U.S. was doing everything it could to free him.
"He's just been held for too long," Ventrell told reporters.
American officials have held talks with Ibrahim Haqqani, the brother of the network's founder, Jalauddin Haqqani, to try to further peace talks with the Taliban, according to two U.S. officials familiar with the negotiation attempts. The designation does not stop the U.S. from meeting with the Haqqanis, who've been among the least interested in talking reconciliation before American troops make an almost complete withdrawal from Afghanistan by the end of 2014, officials said.
Officials spoke on condition of anonymity because they weren't authorized to speak publicly on the matter.
The designation risks straining U.S.-Pakistan relations. Last year, outgoing Joint Chiefs Chairman Mike Mullen argued that the Haqqani network "acts as a veritable arm" of Pakistani intelligence ? the most far-reaching volley in a long dispute between Washington and Islamabad.
Other U.S. officials dispute that assessment but still accuse Islamabad of giving the network a free hand in North Waziristan region and providing it some logistical support. The accusation could take on added significance now that the Haqqanis are officially a foreign terrorist organization ? something the U.S. hasn't issued for the Taliban.
Sherry Rehman, the Pakistani ambassador in Washington, brushed off the designation, calling it an internal U.S. matter and noting that Haqqanis are not Pakistani nationals.
"It's not our business," she said, but added that Pakistan would maintain its counterterrorism cooperation with the United States.
Islamabad says that its forces are stretched thin in fighting an insurgency that already has killed more than 30,000 people and that it cannot also take on the Haqqanis near the Afghan border. Many analysts attribute the military's reluctance to take them on to historical ties and an assessment that the group can be an important ally in Afghanistan after U.S. and allied forces withdraw.
Imtiaz Gul, head of the Islamabad-based Centre for Research and Security Studies, predicted little additional fallout in a relationship that has suffered severe blows in the last 20 months, including a CIA contractor's killing of two Pakistanis, the unilateral U.S. raid that killed Osama bin Laden and NATO's accidental killing of two dozen Pakistani soldiers. But he said the U.S. sanctions wouldn't prompt a Pakistani crackdown or hurt the Haqqanis significantly.
"They are not a corporate sector entity maintaining bank accounts and working via the Internet doing banking transactions online," said Gul. "They operate covertly through intermediaries."
Fighters for the head of the network, Jalauddin Haqqani, were among the leading recipients of CIA money during the 1980s Soviet occupation of Afghanistan, when U.S. money helped finance Afghan rebels. They ousted the Russians in February 1989, overthrowing the Moscow-backed government in Kabul three years later before turning their guns on each other.
Haqqani developed extensive foreign contacts over the years, getting money, weapons and supplies from Pakistani intelligence and serving as justice minister after the Soviets left, and minister of tribal and border affairs after Taliban fundamentalists seized power in 1996. He joined the Taliban insurgency when the U.S. helped overthrow the regime after the Sept. 11, 2001, terrorist attacks.
Since then, the network has developed a sophisticated, mafia-style financing operation that relies on extortion, kidnapping, smuggling and legitimate businesses, according to a recent report by the Combating Terrorism Center in West Point, N.Y.
Last month, the U.S. scored a major counterterror success when an unmanned drone strike in Pakistan near the Afghan border killed one of Haqqani's sons, Badruddin, considered the group's No. 3.
The State Department said in May 2011 that Badruddin Haqqani sat on the Miram Shah Shura, a group that controls all Haqqani network activities and coordinates attacks in southeastern Afghanistan. It also blamed him for the 2008 kidnapping of New York Times reporter David Rohde.
The U.S. already had designated Haqqani and his sons individually as terrorists, but Congress wanted tougher action. In July, it set a deadline to prod the administration into imposing blanket sanctions on the group.
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Lee reported from Vladivostok, Russia. Associated Press writers Sebastian Abbot and Kathy Gannon in Islamabad, and Kimberly Dozier and Donna Cassata in Washington contributed to this report.
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Follow Bradley Klapper at https://twitter.com/bklapperap
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