Is there any airline operating between Islamabad and Kashgar

Yes- There is one- Rayyan Air operating weekly flights on every wednesday. Very cheap fare- just USD 330 return flight.
It is so far the cheapest means to travel between China and Pakistan by making combinations of Air,train and bus. After just one hour flight from Islamabad to Kashgar, hop in a train or bus to go any where in China and vice versa.
Good Luck