Bhatt is visiting Pakistan next week to meet Shan.
"We (Shan and Bhatt) have a meeting scheduled. We will sort out the terms and conditions," Shan told by phone.
Two Indian films, "Mughal-E-Azam" and "Taj Mahal: An Eternal Love Story", are already being screened in Pakistan as part of the emerging cultural ties between the two countries.
Shan said: "It is good to work here and in India. I am a strong supporter that artists should be allowed to move about freely and work together."
Shan said: "Mahesh Bhatt and myself will discuss the script and the role before finalising the deal."
Bhatt will also attend a press conference on Pakistan-India relations.