The revelations were based on a cache of files from 2008 released by former US intelligence contractor Edward Snowden and reported by journalists Andrew Fishman and Glenn Greenwald in The Intercept, an online news outlet, this week.
Read: British e-spy agency hacked network routers to access almost any internet user in Pakistan
In a document marked "TOP SECRET STRAP2 UK EYES ONLY" allegedly issued by Britain's Government Communications Headquarters (GCHQ), the spy agency discusses its computer network exploitation (CNE) and software reverse engineering efforts abroad.
"Capability against Cisco routers developed by this means has allowed a CNE presence on the Pakistan Internet Exchange which affords access to almost any user of the internet inside Pakistan," it said, referring to a US technology company that provides most of the world's network infrastructure.
"Our presence on routers likewise allows us to re-route selected traffic across international links towards GCHQ's passive collection systems."
Digital Rights Foundation, a non-profit that campaigns for online privacy, said in a statement on Tuesday, "This hacking operation, at a scale never previously seen before from the British intelligence agency, seriously undermines the right to privacy of all users of the internet in Pakistan."
The group's executive director Nighat Dad added: "When ostensibly democratic nations carry out such draconian and unethical actions against the citizens of nations they are 'allies' of, it sets a troubling precedent.
Read: Need of the hour: Cyber Crime bill needs a balancing act, say experts
"The government of Pakistan could point to the actions of the US or the UK as justification for passing greater surveillance measures against its own people."
Sagheer Wattoo, a spokesperson for the Information Communication Technology ministry, told AFP: "We are trying to ascertain the veracity of the report. Based on the outcome of the fact finding, the relevant agencies will be directed to take appropriate action."
He added that securing Pakistan's Internet was the responsiblity of Internet Service Providers as a condition of the licences awarded to them.
A spokesperson for the Britain's High Commission in Islamabad meanwhile said: "We do not comment on intelligence issues."
Last month, The Intercept reported that the United States National Security Agency (NSA) had linked Al Jazeera's longtime Islamabad bureau chief to the terror network al Qaeda based on meta-data collected from 55 million mobile phone records.
Pakistan is in the process of debating its own cyber-crime bill, which rights campaigners say threatens to curtail freedom of expression and privacy in its current form.
Rights groups also expressed concern over a provision that allows the government to share intelligence with foreign spy agencies, such as the NSA, and the mandating of service providers to retain telephone and email records for up to a year.
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