India and Pakistan are still talking about resolving their differences, but mostly they are speaking past each other and not really getting down to business. India is upset that, while Pakistan will hand over terrorism suspects to the US, they won't do the same for India. Pakistan is trapped in a situation it created when it got behind the terror campaign in Kashmir. That is seen by most Pakistanis as a war, even if it is an undeclared war. And during a war, there is a lot of popular sentiment to "support the troops." But the troops are largely Islamic radicals who have ambitions that extend beyond driving all non-Moslems out of Kashmir. A real war would see Pakistan lose. And since everyone has nuclear weapons, Pakistan would lose big time. Every time the terrorists up the ante, the region comes closer to nuclear war. 

India has not put all the blame for the Bombay bombings on Pakistan, because, with nearly 150 million Moslems in India, there are plenty of Islamic radicals who are Indian citizens and need no help or encouragement from Pakistan.