Can Indian Rupees (INR) be used or exchanged in Pakistan without converting it to dollars? My parents are travelling to Pakistan and they've been told that it can be used by the people who are making their travel arrangements. I'm not sure because I can't find any credible proof through a quick google search.
I'm afraid that Indian Rupees can't be used in Pakistan. From iatatravelcentre.com
So you're allowed to export up to 7500 INR (130 USD) only if you're indian resident. As people are not allowed to export a big amount of INR I don't believe it would be possible to pay everywhere in Pakistan with INR.
No. I am not sure why the agent is telling you this.
Indian rupees may be imported (there are no restrictions, other than the normal AML restrictions), but they are not legal tender and most exchange houses will not accept them.
You cannot change them for Pakistani rupees inside Pakistan. It would be best to convert them to USD.
A small point to clarify, you also mentioned "without changing them to dollars" the fact is unless its a major trade currency, all currencies are first converted to dollars and then that dollar amount is converted to the local currency when you go to the exchange house.
Of course, if you give direct dollars (and in some places, euros) it does not apply; but for all other currencies the conversion process is literally you are "buying dollars" and then converting the dollars to the local currency.