Asked if Musharraf has decided to quit, Azim said: "There are people who are advising him to avoid confrontation, but I don't think he has made up his mind."
Azim said people on all sides generally agreed an impeachment battle would strain the country at a time when it faces critical challenges such as a slowing economy and an emboldened pro-Taliban movement.
A senior coalition official confirmed to AFP news agency that there were talks with the presidential camp about Musharraf resigning in return for a guarantee against prosecution for imposing emergency rule in November last year.
But the official warned: "Musharraf is an unstable quantity."
Musharraf, who seized power in a bloodless coup in 1999, declared a state of emergency on November 3 to force through his re-election as president for another five-year term.
On Thursday, Nawaz Sharif, a former prime minister who leads the second biggest party in the ruling coalition, said he opposed granting legal immunity for Musharraf.
Sharif's party has previously said Musharraf should be tried for treason.
He alleges the president had violated the constitution and compromised the nation's sovereignty, a reference to Musharraf's alliance with the US in the so-called "war on terror".
"Should safe passage be given to someone who has done this to Pakistan?" Sharif asked an audience marking Pakistan's independence day."
Sharif and Asif Ali Zardari, another coalition leader, said they are finalising impeachment charges against Musharraf and are likely to lodge them in the lower house of parliament on Monday.
The speaker of parliament then has three days to forward the charges to Musharraf, who in turn has to respond within two weeks.
A two-thirds majority is required in the upper and lower houses of parliament to impeach him. The coalition itself is short of that number but has won pledges of support from independents and at least one former Musharraf ally.
Presidential sources have repeatedly told AFP in recent days that Musharraf "will not play the numbers game" -- a reference to fighting out the impeachment move in parliament.