Prime Minister Nawaz Sharif on Monday ordered to reopen the Pak-Afghan border immediately, according to local media reports.
Afghans are increasingly turning to smugglers as Pakistan's month-long border closure blocks trade and causes food prices to soar after a bitter terrorism spat between the two neighbors.
The Prime Minister said that the decision was taken as a goodwill gesture as the countries enjoy "religious, cultural and historical ties", reported Dawn newspaper.
Pakistan closed the border last month over security concerns after a series of attacks which killed almost 100 people.
"A durable peace in Afghanistan is essential for peace and stability in the region", he said.
Sharif said this was being done despite recent militant attacks in Pakistan being traced back to militants using Afghan sanctuaries.
"In order to provide an opportunity to those nationals of Afghanistan who had come to Pakistan on valid visas and wish to return to their country", stated the press release of Ministry of Foreign Affairs.
The statement said that, while the government had evidence that "anti-Pakistan elements" were present on Afghan soil, keeping the border closed was against the interests of ordinary people.
Pakistan and Afghanistan share a 2,600-kilometer largely porous border, with five dedicated crossings for legal movements, including bilateral and transit trade convoys, transporting imported goods to the landlocked country from the Pakistani port of Karachi on the Arabian Sea.
On the call of all Torkham custom clearance agents of Torkham, a large number of custom agents, traders, transporters and political party leaders gathered at Landiktoal bazaar and hold protest demonstration demanding the immediate reopening of Torkham border.
"We hope that the people of the two countries would be able to move freely between the to countries", the spokesman added.
Islamabad blamed terrorist sanctuaries on the Afghan side for plotting the attacks and demanded action against them.