President Mamnoon Hussain administered the oath to Ismail on Friday during a ceremony at the Presidency.
Cabinet members, party workers and senior officials were present during the ceremony.
Ismail will be presenting the federal government's last budget of its tenure in the National Assembly today.
In December last year, the federal government had appointed Ismail as the adviser to the prime minister on finance, revenue and economic affairs with the status of federal minister.
Prior to that, Ismail was the special assistant to the prime minister on economic affairs.
At the time, Senator Ishaq Dar was holding the reins of the Finance Ministry but had to let go owing to his medical treatment abroad.
He has been in London since October last year while a corruption case is under way against him.
Ismail, a political economist, holds a PhD from The Wharton School, University of Pennsylvania.
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