"Security can be improved while schools are still on. We should give a message of strength and unity and fight against the atmosphere of fear and terror," Nisar Ali Khan said.
Punjab ordered closing of schools for the entire week citing extreme winter as the reason but media reports suggested that threat of militant attacks forced the government to take the decision.
"The terrorists are desperate so they are attacking the softest targets. There are hundreds of thousands of schools in Pakistan. Securing each is a difficult job, but it must be done," Khan said.
Khan said that he rejected a proposal to close schools in capital region of Islamabad.
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He said that if the trend of closing buildings continued then a day would come that "we close all our educational institutions, hospitals, streets, neighbourhoods and hide ourselves in our houses" to the satisfaction of terrorists.
The minister said that the Pakistan was winning the war against militants but it needs to face them in the area of psychological warfare.
"I think at this point we are not winning the psychological war and we need to address the part," he said.
"Whenever there is an attack, a storm begins. We behave exactly how our enemies want by creating an atmosphere of fear. People criticise the government saying no progress has been made," he said.
The minister said that National Action Plan (NAP) adopted after the 2014 Peshawar school attack was being successfully implemented under the civilian government while army was carrying out Operation Zarb-e-Azb.
"Networks of terrorism have been broken. The terrorists are on the run so they hit the softest targets," he said.