The decision resulted from Pakistan's inaction against terror financing.
The public is no longer scared to send children to school or go shopping as it was in the past, residents say.
The Pakistani Taliban is unlikely to survive the power struggle for the top slot, observers say.
Survivors of the 2014 massacre, as well as the relatives of the slain, welcomed the killing of TTP leader Mullah Fazlullah in an air strike in Afghanistan last week.
The dead leader's successor, Umar Rehman, will be unable to unite the already divided Tehreek-e-Taliban Pakistan (TTP), analysts say.
The Taliban are running scared and cannot sleep at night because of an undercover, Afghan government-backed group fighting the militants, local officials and tribal elders say.
Afghanistan's Ministry of Defence confirmed the death of Pakistani Taliban chief Mullah Fazlullah in what security analysts called a 'big loss' to the militants.
Khyber Pakhtunkhwa Police are taking every step possible to protect public areas during Eid.
The $3.7 million donation will help fight drug trafficking and militancy in Pakistan and throughout the region, analysts say.
Authorities in the newly merged Khyber Pakhtunkhwa and Federal Administered Tribal Areas are removing checkpoints and unblocking roads as a result of improved security.