India could occupy parts of Pakistan, but there are simply far too many Pakistani civilians who would actively resist a full-scale occupation.
India could probably defeat the Pakistani armed forces (although one wonders at what cost given the nuclear capability of both countries), but they couldn't really occupy and subdue the civilian population which is heavily armed.
Hell, Pakistan hasn't even conquered its western provinces.
I don't think we wanted to occupy any part of Pakistan in the past. This hasn't changed much in the present. We are quite glad to rid ourselves of a whole bunch of stupid Islamofascists and besides after having seen the West Germans complain about the down-turn in their economy post-reunification, I really hope no one in India wants to reunify with Pakistan. It will be a fiscal black-hole. The areas I would like to see India occupy are specifically strategic regions to prevent infiltration of terrorists into India, this would include PoK and mountainous terrains of the Northern parts of Pakistan. This will also serve to cut-off Pakistan from China via land. I believe this is of utmost importance and MUST be done in the event of a future war.
Another good idea might be to completely occupy coastal Pakistan to cut off sea access, as well as to gain access to the Persian gulf ourselves. This will enable India to become a key security player in the Middle East and secure western interests in the region against any adventurism by Iran. I think that America should let this happen to increase the stakes for India against a nuclear middle-east. A nuclear Iran will not be a good neighbour for India. Also Iran will better behave itself if the US uses Indian influence on Iran to push Iran's leadership to behave.
For this we have to wait for a US administration that sees Pakistan for what it really is, a double-faced, treacherous "ally" in the GWOT. Irrespective, it is absolutely vital for the world that Pakistan be completely disarmed. I mean absolutely no guns, no weapons nothing of any kind either with the military or with civilians. A modern-day version of post-war Japan. Just pistols for policing and nothing more.
Pakistan has not "conquered" it's Western frontiers not because of it's inability,but it simply has ignored the area & just used it's strategic value.
PS-did you know that if the most popular leaders in the NWFP,Khan abdul Gaffar KHan & Khan Sahib,didn't boycott the British held referndum in 1946