I think, most posters are stating just what they can see or relate or expect to happen, overlooking the root cause. There are 3 formats in cricket, and PAK already is among the best T20 sides, poor ODI team and horrible Test side - being 7th in Test ranking, behind SRL doesn't need explanation.
Personally, I think PSL is a fantastic T20 tournament, well organized and professionally managed, and the quality is getting better. Into it's 3rd year, already contributing to the PAK T20I team in terms of player scouting, combination and skill set (required for the format). It should, get stronger & better, bigger - so should be PAK's T20I fortune. It perfectly indicates, where PSL is taking PAK cricket to.
For last 2/3 years, apart from usual Corporate & Regional Cup (s), PCB is arranging PAK Cup List A tournament, which I think is better than any List A tournament arranged by PCB in last couple of decades I can recall - this is a type of tournament always suggested when the domestic cricket is not structured. The idea is simple - since, domestic teams/tournaments are not standardized, try to gather top players in country and make them compete against each others in a evenly matched competitive tournament. The outcome is actually encouraging - inconsistent, but still PAK ODI team has managed to turn the screw in right direction for last 2/3 years - Arthur & Sarfraz has a big role to play in it, but still this is far away from the 2015 WC or 2013 CT situation. Top 3 could be a long shot, in fact there is a good gap between 5th & 6th spot on ranking table & it'll take a massive improvement in consistency just to make up that ~15 points gap, but indeed it's possible to out perform ranking table in tournaments, as the skill sets are better than the position on ranking table.
There are 5 serious Test teams to be honest - always had been like 5/6, max 7 at some point, but recently WI has managed to relieve themselves from that worthless status, SRL was never there while in NZ, it's going south at an alarming rate and SAF is heading for a major transition in their shift to popularize cricket among 90% brutal majority - it should cost them some years, even if they can recover. Least said about BD, ZIM is better, and I don't have much hope from AFG & IRL in Test cricket. In that context, 7th in ranking and behind NZ, SRL - probably a perfect reflection of Quaid e Azam style - long may it continue, one should see the future in reflection.