Poonam Dhillon (left) and Sunny Deol star in the film

Sohni Mahiwal - based on folklore popular in the Punjab region - has been given special exemption.

The Pakistan Film Producers Association said the move did not mean the overall ban on Indian films was being lifted.

Pakistan banned screenings of Indian films in 1965, when the countries fought the second of their three wars.

Legal battle

Pakistan Film Producers Association chairman Saeed Rizvi was widely quoted in the media as saying the 40-year ban was being lifted.

I filed seven petitions in Lahore High Court and twice approached the Supreme Court Film distributor Ali Zafar

But he told the BBC News website he had been "wrongly interpreted" by other media organisations and had made no such suggestion.

"The ban has not been lifted from all Bollywood films but just this one," he said.

Mr Rizvi said the distributor of Sohni Mahiwal, a 1984 romance and Indo-Russian joint production, had approached Pakistani President Pervez Musharraf for the waiver.

The film's distributor, Ali Zafar, said he had imported the film in 1989 and had fought a legal battle since then to screen the film in Pakistan.

"I filed seven petitions in Lahore High Court and twice approached the Supreme Court of Pakistan, which decided the case in my favour because the story was based on a Punjabi folklore," Mr Zafar told the AFP news agency.

Illicit copies

India's Hindi-language film industry, which includes Bombay's Bollywood movies, is the world's largest by viewership.

The lifting of the ban for one film is not part of a wider trend

Bollywood films, which typically feature exuberant song-and-dance routines, are watched by millions around the world.

The BBC's Zaffar Abbas in Islamabad says there is absolutely no suggestion that the government is considering lifting a ban on all Indian movies.

He says cinema owners in Pakistan are keen to screen Bollywood films, but the nation's filmmakers fear an influx of such films would destroy Pakistan's film industry and are therefore opposed to the ban being lifted.

Even during the ban - and despite the bitter rivalry between the neighbouring countries - Indian films are hugely popular in Pakistan and illicit copies are easy to find.

Pakistani producers are thought to have worked secretly in India for several years, sidestepping the government ban by purportedly going to visit family and friends but getting films edited and music composed in Bombay.

Pakistani cultural products are legal in India, where the country's poetry, songs and television dramas are widely popular.