I still remember after the attack on Parliament in 2001, there was a fast track process in place to extradite Dawood Ibrahim ( we all know about this monster). But diplomacy did not work. At that time Indian govt relied on US's support to crack down. Although US no longer has that deep relationship with Pakistan that existed before Kargil war, it is still hesitant to take any action. This is because Pakistan's army is required to capture Osama. The Afghanistan Pak border is the new battleground and the US army is busy with it. If India declares a war, all the troops from either side will be diverted to Kashmir. This will obstruct US plans. Just to ensure that it doesn't happen, Rice ( US secretary of State) came to India. What a shoddy diplomacy? US says it needs evidence against Pak? What sort of evidence did US have when it attacked Afghanistan and Iraq. Not anything concrete. So, is Indian life less precious than American one? Why should Indian govt wait for US to decide its action plan. Ideally, the govt should bomb all those terror camps, locations of which are clearly known to us. Pakistan per se is not our enemy. It is this ISI and Army whose tacit support spawns new terror camps and accelerates the growth of existing ones.
Why should India still listen to handover Dawood when Pak will not hand him over to India. India must take action on its own. Go for the war as coercive diplomacy doesn't work. In fact, these criminals must be shot at sight rather than capturing them.
In 2001, when Parliament was attacked, the then govt resorted to diplomatic means to cripple Pakistan. Indian govt stopped all trade with Pakistan, isolated it from Commonweath nation, stripped its status of the Most Favoured Nation (MFN), crippled its economy, stopped all confidence building measures, stopped all train links. This in a way helped India as there was no major terrorist attack. At least Govt took a very tough step and showed to the world that we are not soft.
Pakistan sensed this and resorted to Bangaldesh to destabilize India. Today, Bangladesh and Pak are 2 sides of the same coin - enemy of our nation.
The Indian govt must resort to tough diplomatic steps, and also plan for military action as Pakistan will not change. However, it must be borne in mind that taking a step of military is going to cost India more. We are still a growing economy and any war will slow us down and the fact that Pakistan is nuclear power must be kept in mind. It is a must step, but must be taken with greatest caution and sensibility.
I wish Indira Gandhi was the PM at this point. She would have gone for a war by giving deaf ears to US. She is the toughest leader when it comes to terrorism India has ever seen. She was the one who formed the NE India, curbed terrorism in Punjab, clamped down Anti-Hindi sentiment in TamilNadu, annexed Goa, went for a complete war with Pak in 1971 by saying to the then US President - "The President of a developed country need not dictate terms to the Prime Minister of a devloping country as to what should be done in a crisis like this"...It was the boldest statement ever made by an Indian leader to an US president.
if she was here, she would have asked RAW to kill Dawood Ibrahim. The govt must revamp internal security - create a single investigative agency and a single intelligence agency so that co-ordination problem doesn't exist. The govt must also give powers to RAW not just to get intelligence but also to take counter terrorist steps.