Hafiz Saeed, arrested now, is wanted in India over the 2008 Mumbai terror attacks.
Hafiz Saeed, the Mumbai attacks mastermind, was arrested on terror finance charges and sent to jail in Lahore on Wednesday. He was sent to judicial custody and will face trial, said reports quoting a spokesperson for the chief minister of Punjab province.
Hafiz Saeed was travelling to Gujranwala from Lahore to appear before an anti-terrorism court when he was arrested by the Counter Terrorism Department (CTD) of Punjab. He has been sent to the high-security Kot Lakhpat Jail in Lahore, officials said.
"The main charge is that he is gathering funds for banned outfits, which is illegal," said the Punjab province spokesman.
The move comes days before Pakistan Prime Minister Imran Khan's visit to Washington, where he will hold talks with President Donald Trump.
"After a ten year search, the so-called "mastermind" of the Mumbai Terror attacks has been arrested in Pakistan. Great pressure has been exerted over the last two years to find him," Donald Trump tweeted.
Indian government sources are skeptical and cautious until Hafiz Saeed is "actually tried and convicted".
Hafiz Saeed, the founder of the terror outfit Lashkar-e-Taiba and US-designated terrorist, has been blamed for the terror attack on Mumbai on November 26, 2008, in which 166 people were killed. The US has offered a $10 million reward for information leading to Hafiz Saeed's conviction over the 26/11 attacks.
Despite India's dossier of terror cases against him and evidence of his involvement in the four-day siege of Mumbai by 10 Pakistani terrorists, Hafiz Saeed has been allowed for years to roam freely in Pakistan and even address anti-India rallies with impunity.
Pakistan, which is included on the "grey list" of the Financial Action Task Force, a money laundering and terror finance watchdog, has been under increasing pressure to stop financing terror groups.
Earlier this month, Pakistan had filed terror charges against Hafiz Saeed following sustained international pressure. He was charged with multiple offences of terror financing and money laundering in a First Information Report.
In 2017, Hafiz Saeed and his four aides were detained by Pakistan but they were released after nearly 11 months when the Judicial Review Board of Punjab refused to extend their confinement.
The US, just before the 10th anniversary of the Mumbai attacks in November, had urged Pakistan to take action against those responsible for the attacks and had offered a new reward of $5 million.
"It is an affront to the families of the victims that, after ten years, those who planned the Mumbai attack have still not been convicted for their involvement," US Secretary of State Mike Pompeo had said in a statement.