Test opener Azhar Ali and left-arm pacer Mohammad Aamir, who recently announced his retirement from Test cricket, have been demoted in category B and C respectively.
The board has also reduced the number of centrally contracted players from 33 to 19 for the 2019-20 season during which the men's cricket team will play six World Test Championship Tests, three One Day Internationals and nine T20Is.
"While finalising the list of central contracts, which will run from 1 August 2019 to 30 June 2020, players' performances and fitness in the past 12 months and the formats they are likely to represent Pakistan in the upcoming season was taken into consideration," PCB said in a media release.
Despite Malik and Hafeez's omission, the PCB maintained the two will be available for selection.
"Mohammad Hafeez and Shoaib Malik have not been offered contracts but they will remain available for selection."
Malik had announced his retirement from ODIs after the World Cup and will now only play T20 format while Hafeez has retired from Test cricket.
"The PCB have set high standards and targets in its strategic plan for the upcoming season. We want to attach a high value to receiving a central contract.
"We have complete faith and confidence that these players will set-up and produce on-field performances that will help us collectively achieve our objectives and targets," PCB Managing Director, Wasim Khan said.
Category A – Babar Azam, Sarfaraz Ahmed, and Yasir Shah