Ghai, visiting Pakistan in connection with the fifth Kara Film Festival, said: "We are never two, we are always one."
The maker of hit films like "Taal", and "Pardes" said that in the last 27 years that he has been making films he has always known the fondness with which Pakistanis watched his films.
In an interview to Hum television channel, Ghai said: "I really feel honoured to be in Pakistan and admire Pakistanis' keenness for Indian movies."
Ghai, who has introduced stars like Madhuri Dixit, Meenakshi, Manisha Koirala and Mahima Chaudhry to Bollywood, said he feels at home in Pakistan as his father used to practice medicine in Lahore before the partition in 1947 and his ancestors were from this land.
"It is a very emotional moment for me to be here, among Pakistanis," he said.
Ghai's film "Iqbal", about a deaf mute child who wants to become a national cricket player, is the opening film at the Kara Film Festival which was inaugurated in Karachi Thursday.
Well known Indian actor Anupum Kher, who is also in Pakistan and participated in the TV interview, said: "Films have no religion or boundary, only passion, which, in this case, binds the two nations of Pakistan and India together."
Kher has chosen the Kara Film Festival for the international premiere of his production "Maine Gandhi Ko Nahin Mara".
Filmmaker Mahesh Bhatt, a regular at the film festival, thanked fellow Indians Subhash Ghai and Anupum Kher for accompanying him to Karachi.
"I have fallen in love with this place as it is an extension of my own home," he said.
He chose the words of an aboriginal Australian woman to express his thoughts: "If you are coming to help me, please go away. But if you are coming to me with the realisation that in my redemption lies your redemption, then we can work together." He said the future of humanity lies in the sentence.
"We are part of the human race and we cannot help but be concerned about one another. Let us dream of a future that brings to us all what we have lost."
He urged people not to mistake globalisation with westernisation and to tell stories, look around and understand. "If Europe can become a union then certainly this region can become one too," he said.
An Odissi dance performance by Sadia Khan, followed by that of other artists, including a musical concert by Farid Ayaz Al-Hussaini Qawwal marked the beginning of the five-day film festival.
The opening ceremony was held on the lawns of the Mohatta Palace Museum Thursday evening with local and international filmmakers and stars in attendance. An impressive fireworks display was held after which Festival Director Hasan Zaidi addressed the audience.