Iqbal was shot on the right shoulder while he was in his car being about to leave a public meeting in Narowal where the minister held a speech, the politician's aide Asim Khan confirmed.
"He is out of danger and being taken to a medical facility in Lahore. The attacker has been arrested," the official added.
Media reported that the shooter was a resident of Narowal aged between 20-22 years. A pistol was recovered from the detained assailant. Investigation is currently underway.
The country's Prime Minister Shahid Khaqan Abbasi has condemned the attack, which comes as Pakistan is preparing for general elections due to take place in summer. The suspected assassination attempt is believed to raise political tensions in the country ahead of the vote.