The first showdown on Pakistani soil in over 14 years has a political dimension as the teams will be playing in an emerging climate of rapprochement and peace, Khan said in an interview on Tuesday.
"When the two countries are trying to become friendly, trying to ease tensions, then cricket plays a healing role, cricket becomes a cement in bonding the countries together," said Khan, a member of the Parliament and head of the Justice Movement party he founded seven years ago.
When the arch-rivals go head-to-head on the cricket ground, it is not just sports fans who get hooked, said Khan, who led Pakistan to glory in the 1992 World Cup. "It transcends sports, it is much more than cricket, it is passion."
The Indian team is due to arrive on Wednesday in the eastern city of Lahore for a tour that will include five One-day Internationals and three Test matches.
Khan said the series was exciting because it came against a backdrop of decades of mutual hostility which nearly boiled over into a feared nuclear war two years ago. "Therefore people are really skeptical, is it really heading towards peace?" he said.
"I feel that the two Governments have realised that war is not an option. This is a realisation which came after their forces were eyeball to eyeball for so many months in 2002."
Relations between the South Asian neighbours have improved so far that Khan even felt able to tip India for victory in the One-day contest, although he backed his countrymen for victory in the Test series.
But the outcome of the series would depend more on which team could cope with the pressure that always hangs over any sporting clash between them, he said. He tipped fast bowler Shoaib Akhtar as Pakistan's trump card, but he will only have ten overs in each match.
The team with the stronger batting line up will carry the day. "The team which has strong batting, which India does have, will have an edge in the One-day games," Khan said.
However, there will be no walkovers for either side and the spectators will see fierce competition on the field. "A lot will depend whether Indian captain Sourav Ganguly can take pressure better than Inzamam-ul-Haq to determine the outcome of the match."
Pakistan's bowling strength would give it the edge in the Test series. Khan said a friendly atmosphere would prevail in the March 13 to April 17 tour.
"There will be a lot of rivalry and competitiveness on the cricket field but there will be intermingling of civil society. Lots of Indians are coming here to watch cricket. This will help ease the tensions. "Even an incident does occur, then the two Governments will quickly smother over it."