I have said it before and will say it again, prolonging death sentences is a normal strategy that Govts use when they are not sure whether the person charged is guilty, but have already given a verdict they feel might be faulty.
Pak is playing the safe option here.
1.They cant release Srabjit even if he is innocent because it will be a big international shame if word gets out they kept an innocent man in prison for 23 years.
2. They can't hang him, probably because there are doubts whether he was involved in whatever activities their LET and Taliban actually did, which they claim Sarabjit did. They are simply scapegoating him. Got to say, for a so called high end terrorist, Pak Govt sure doesnt like to talk about him much, if you compare that to Indian Govt's stance on Kasab.
3. They cannot overturn the death penalty, because there will be international outrage over how an innocent man was given the death sentence to begin with
So what happens? Pakistan will just make him die to death in his prison, and make sure not much media coverage is given to him and the case, just like they have been for the last 23 years.