While all this sounds really good, we should be ready for retaliation by the Pakistanis in kind. Please remember that Pak armed forces (except their so called navy) is not a pushover. Yes, we have more men, materials and resources, and will prevail in a war of attrition, but we need to be able to have the capacity to absorb an attack on delhi, Ahmedabad, Surat, Chandigarh and other urban centers within easy reach of Pak. That requires political will and not military might. Also, in such a scenario we will see flight of capital from India and the economy will go back at least 10 to 20 years.
Hence, IMHO, (and as a complete non-expert in these matters) we should either go for an all out war with the aim to annihilate Pak, or continue with a mix of covert action, cross LOC action and economic strangulation.