Amid mounting international pressure, Pakistan Prime Minister Imran Khan on Thursday announced that the captured IAF pilot Abhinandan Varthaman in the custody of its armed forces would be released on Friday.

Speaking in his country's Parliament, Imran Khan said that the pilot would be released as a ''peace gesture'' towards India.

"The release of the pilot is the first step towards open negotiations," he said while confirming that he would call Prime Minister Narendra Modi later in the day.

Addressing a joint session of the National Assembly, Khan said the India-Pakistan situation should not "get out of hand" otherwise "Pakistan will have to retaliate".

"Countries are ruined because of miscalculation," said Khan. Alleging "war hysteria" in India, he said, "I'm afraid that there might be a miscalculation.''

"War is not a solution. If India takes any action, we will have to retaliate," PM PM said. The joint session of Parliament was called to discuss the rising tensions with India.

The surprise announcement came barely an hour after country's Foreign Minister Shah Mehmood Qureshi said that Prime Minister Khan is ready to talk to Prime Minister Narendra Modi to de-escalate Indo-Pak tensions.

The announcement was greeted by thumping of desks by Pakistani lawmakers.  

Sources claimed that the captured IAF pilot will arrive home through Wagah Border on Friday.

India had so far maintained a strong position and had demanded the immediate and safe release of the pilot. Government sources had earlier said that India was absolutely against any deal with Pakistan for his release.