Foreign Minister Shah Mehmood Qureshi announced in the National Assembly on Thursday that Prime Minister Imran Khan has decided to not stand in Leader of the Opposition Shahbaz Sharif's way, if he wants to head the Public Accounts Committee (PAC).

"We met Prime Minister Imran Khan today on the issue of PAC chairmanship," Qureshi said. "We had offered the opposition to nominate any person other than Shahbaz Sharif but they did not budge.

"Imran Khan has reviewed his decision and if Shahbaz Sharif wants to head the PAC, the government will not cause hindrances.

"In the larger interest of democracy and in order to make the parliament functional, we concede to the opposition's demand."

The development is a major breakthrough as the impasse between the government and opposition parties over PAC chairmanship had hampered legislative proceedings since the PTI assumed power in August.

Opposition lauds PM's 'most positive U-turn'

Sharif credited the PM for "reviewing his stance", recognising that "the government wants to make this parliament functional as it wants to bring important legislation for the welfare of the people."

PML-N leader and former NA Speaker Sardar Ayaz Sadiq felicitated the prime minister and termed the decision as his "most positive U-turn".

"If he continues to take such U-turns, democracy will be strengthened," he said.

Sadiq pointed out that PAC chairmanship would only count as one vote in the committee, in which government members would still be in majority.

Furthermore, he said, "when the audit paras of the PML-N government will come up before the committee, it will be headed by some other senior member."

PPP leader and former prime minister Raja Pervez Ashraf acknowledged NA Speaker Asad Qaiser's efforts "for playing a positive role" in the resolving of the PAC chairman issue.

Ashraf also lauded the government for reviewing its decision, adding that "after four months, this house will become functional".

"Hopefully, the parliament will now carry out legislative business," he said.

The PAC is the apex parliamentary watchdog that oversees the audit of revenue and expenditure by the government and it is considered to be the most powerful and important committee of the parliament. Previously, the PAC comprised only members of the National Assembly, but recently members of Senate have also been made part of it.

Though there is no restriction on the government in the rules to give the chairmanship of the PAC to opposition parties, it has been a parliamentary practice and tradition that the office is given to an opposition member to ensure transparency in financial matters.

Opposition walks out over Saad Rafique's production order

Earlier, Sharif requested the speaker to issue a production order for fellow PML-N leader Khawaja Saad Rafique, who was remanded to the National Accountability Bureau's (NAB) custody a day earlier as part of a probe into a housing scheme scam.

Speaker Qaiser said he would seek the legal opinion of the law ministry on the issue but assured that "I will not let this house down."

Later in the session, Sharif's request was reiterated by Sadiq, who urged the Speaker to unilaterally issue Rafique's production order instead of seeking the law ministry's guidance.

The former NA speaker told his successor that his name "will be written in golden words in history if he would issue the production order".

"It was in the dictatorship of General Musharraf that the production order of Javed Hashmi was not issued," Sadiq recalled.

The opposition parties then walked out of the parliament, with Sadiq declaring that they "will boycott the house until Rafique's production order is issued".

The NA session was adjourned till Friday morning.