Indian director Karan Johar’s film, Ae Dil Hai Mushkil

A top Bollywood film mired in controversy for featuring a Pakistani actor will open as scheduled in India during the festival of Diwali, after an industry body agreed to ban actors from across the border in future.

A hardline Hindu-nationalist party had threatened to attack cinemas that showed prominent Indian director Karan Johar's film, Ae Dil Hai Mushkil, as tensions run high between New Delhi and Islamabad.

The Film and Television Producers Guild of India has now promised to bar Pakistani actors in future under a deal brokered between the sides on Saturday.

The film, starring Pakistani actor Fawad Khan, is set for release next weekend, two days before the Hindu Diwali festival of lights, an important holiday in India.

"In the larger interest of the sentiments of the people and the soldiers and the entire country, we will not work with any Pakistani artist in the future," the guild's president, Mukesh Bhatt, told reporters after the meeting.

Bollywood is the latest battleground for heightened tensions between the nuclear-armed arch-rivals India and Pakistan, sparked by a deadly attack last month on an Indian army base blamed on Pakistan-based militants.