"I think that production houses in Lahore and Mumbai should work for joint productions which will be acceptable to the governments and people of both the countries," Shabana Azmi told.
Shabana Azmi and Farooque Shaikh, who graduated from the theatre to Bollywood, were in Pakistan for three days with their popular play "Tumhari Amrita", which has been running to packed houses in many countries for over a decade.
She said instead of seeking permission for screening each other's films, producers should go in for joint productions.
"We may have the equipment but you have the writers," she said, adding that Pakistan was an untapped mine of talent.
Excited to be in Pakistan, Shabana Azmi said she had been received "warmly" and spoke of the inevitable osmosis between India and Pakistan that she said was natural given their cultural similarities.
"It's good that 'Mughal-e-Azam' has been cleared by Pakistan. But instead of seeking clearance for every film, I would urge the (showbiz) people on both sides to go in for joint productions."
Pakistan's culture ministry recently agreed to screen "Mughal-e-Azam", the 1960 classic starring Dilip Kumar and Madhubala. Pakistan banned screening of Indian films in 1965 after a war with India.
Shabana Azmi said her visit was a reflection of the strides made in the peace process between the two countries. "It's exciting that Indians are here to raise funds for the Pakistani (earthquake) victims."
After a daylong visit of Islamabad, both the actors performed in Karachi before flying back to India.
Proceeds from the play will go towards the establishment of The Citizens Foundation, an NGO that runs schools for poor children in the areas in north Pakistan devastated by the October earthquake that killed over 75,000 people and left three million homeless.
Adapted by Javed Siddiqui from A.R. Gurney's "Love Letters", the play has been praised not only for the way it localises the original but also for the poetic Urdu it uses to keep the audience riveted.
The play delicately etches the relationship between the two protagonists, Amrita (Shabana Azmi) and Zulfi (Farooque Shaikh) over a lifetime through a series of letters.
Devoid of any theatrics, the two characters have only two tables and two chairs as props. Except for the magic of the spoken word, very little supplements the action.
Expressing happiness over India-Pakistan relations, Shabana Azmi said: "I believe artistic ventures can make these bonds strong."