The PPP today issued its list of candidates for National Assembly seats in southern Punjab.
Khar's father, Ghulam Rabbani Khar, will be the PPP's candidate for parliamentary seat no 177 in Muzaffargarh district, which was earlier held by her.
Khar had filed her nomination papers for parliamentary seat no 177, from which she was elected in 2008.
However, the Returning Officer had raised objections to her candidature as her husband's textile factory owes Rs 560 million to a bank.
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Khar's name is also not in the list of PPP candidates for parliamentary seats reserved for women.
She recently told the media that she was not interested in contesting the May 11 general election or becoming part of the next parliament through a reserved seat.
She also said she wanted to concentrate on her family.
However, a PPP leader from Punjab told PTI that there several reasons behind the recent developments.
"First, her father could not contest the 2008 polls because candidates were required to be graduates and now he has to fight in his constituency. Second, the family, especially her husband, suffered due to false reports of her alleged relationship with Bilawal Bhutto Zaradri, the son of President Asif Ali Zardari," the PPP leader said.
The nomination papers of Khar's father have been cleared by election authorities. Under new rules, it is no longer mandatory for candidates to be graduates.
There has been speculation in political circles in Islamabad since last year that Khar would not contest the upcoming polls, making way for her father to make a fresh bid to enter the National Assembly or lower house of parliament.
At the age of 34, Khar had become Pakistan's youngest and first woman Foreign Minister in 2011.