The Indians are upset with their government for not protecting them. That the special operations unit trained to handle this situations had to sit on the ground for eleven hours waiting for transport (because no jets were available), that the government withdrew security from the hotels two days before the attacks (because they felt the threat had passed), and that the government had failed to secure the sea ports (which were a widely known vulnerability). They are pissed. The Indian government is attempting to point west and say, "It was Pakistan's fault." It's neither India or Pakistan's fault entirely.
The truth is you can't watch everything. War is economy. Terrorism's asymmetrical aspect includes that in the calculations. To prevent a terrorist attack governments must spend multiple factors of money in comparison to what terrorists spend on attacks. We're talking levels of tens of thousands to one here. There just isn't enough money in the world for that. So smart governments work to cut the legs out from under terrorists (something we actually did at the beginning of the War on Terror) by causing the terror groups to spend more money to keep moving, resupply, etc, and only costing the targeted country slightly more than what they already were spending on standing armies. There's also the challenge of depriving terrorists of their causes. It's much harder to recruit when people aren't upset, have full bellies, and relatively stable lives. There used to be an argument about poverty and lack of education but the last eight years have proven that argument to be false (although it never hurts to also help on those fronts as well).
But I'll reiterate here terrorists are not in the business of killing innocents; they're in the business of toppling governments. Their tactic is killing innocents, striking at the fundamental social contract between the government and the governed. Their goal is to first convince the governed, which they view as passive adherents of the status quo, that their government can not protect them. This is done by keeping them in fear (the terror part). The next step is to show the governed that their government is willing to toss out civil liberties, the rule of law, and will violate the basic principles of civilization to strike back. It's the terrorist's hope that the governed will realize that their government is out of control and might be willing to use the same tactics on them. At this point the terrorists are playing on psychology to have that fear they instilled, through time and weariness (fear is tiring), change into anger. With what they've done they expect that anger will be directed at the government, which will lead to an uprising and revolution. If the terrorists are still alive (it's not a given within their own psychology, they are willing to die to accomplish the overthrow) they hope to use the resulting chaos and instability to grab the reigns of power. But by this point their main goal has been achieved.
Everybody see all the interviews with the Indians who are fed up with the impotence and incompetence of their government? Notice the pattern? The terrorists are winning.
So, what to do? First, Pakistani ISI has to go. It cannot be reformed. Trash the whole organization, put on trial those whom you can prove support the terrorists as traitors to the government (after all, one of the Taliban's and Qaeda's goals is the overthrow of the Pakistani Government). Then create a new internal and external security/intelligence agency carefully vetting all those who join and tied it to the civilian government.
The rest of the items that need to be accomplished come under the "easier said than done" category. The Autonomous Tribal Areas must be federated. No longer can a modern nation state tolerate such a condition. It can't be by fiat, but instead the tribal leaders need to be convinced that abandoning their current system will be a net gain for their people. Unfortunately right now the trend is in the opposite direction that many of the federal areas aren't so sure they want to remain that way. The Pakistani Military must be brought to heel and made subservient to the civilian government. Kashmir must be an independent country, with a stable government and the ability to protect its borders. Without all three of these actions this part of the world will continue to be unstable and a breeding ground for insurgents.
Say, wasn't all this set up by the British. Hmm. What other countries did they screw up? Oh, yeah.