Islamabad: The captured Indian Air Force (IAF) pilot will be freed on Friday "as a peace gesture", Pakistan Prime Minister Imran Khan announced on Thursday.

Addressing a joint session of the National Assembly, Khan said the India-Pakistan situation should not "get out of hand" otherwise "Pakistan will have to retaliate", the Dawn reported.

"Countries are ruined because of miscalculation," said Khan. Alleging "war hysteria" in India, he said: "I'm afraid there might be a miscalculation.

"War is not a solution. If India takes any action, we will have to retaliate."

The joint session of Parliament was called to discuss the rising tensions with India.

"The only purpose of our strike (on India on Wednesday) was to demonstrate our capability and will," said the Prime Minister. "We did not want to inflict any casualty on India as we wanted to act in a responsible manner."

He said he tried to call Indian Prime Minister Narendra Modi on the telephone on Wednesday because "escalation is not in our interests nor in India's".

Wing Commander Abhinandan Varthaman of the IAF was captured by Pakistanis on Wednesday after his MiG was shot down and fell in Pakistani territory during a dogfight.