Aiyar, 76, suspended by the Congress from the party for his "neech" (lowly) jibe at Prime Minister Narendra Modi during the Gujarat Assembly polls, was here to attend 'Karachi Literature Festival'.
During a session, he hailed Islamabad for seeking to resolve issues with India through dialogue, saying New Delhi does not have this policy, Geo News TV reported.
"There is only one way of resolving India-Pakistan issues and that is by an uninterrupted and uninterruptible dialogue," Aiyar said.
The Indian politician said that he is "proud" of Pakistan for having this policy, however, regretted its non- reciprocation by New Delhi, the Pakistani media report said.
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His words followed an applause from the audience.
Aiyar further said that Kashmir and terrorism are the two main issues that need to be dealt with.
He also said that both India and Pakistan should adopt a framework formulated by former president Pervez Musharraf's government, the report added.