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The attack on a police station in Gurdaspur has the security establishment worried about the terror footprint expanding to Punjab, which has seen peace for two decades after years of grappling with terrorism.
Sources said an advisory was sent three days ago to several states including Punjab about a possible terror attack. But the intelligence that the advisory was based on was not specifically about Punjab, the sources said.
Three terrorists struck in Dinanagar in Gurdaspur, killing six people in an attack on a bus and then on the police station, where they were holed up and engaged security forces in a gun battle. Sources say all three terrorists have been shot dead.
The Opposition Congress has alleged a major "security lapse and intelligence failure".
"It is said that they have come from across the border... if that is true, it is a security lapse and intelligence failure," Congress leader Anand Sharma said, adding that Prime Minister Narendra Modi needed to take firm steps.
"Where is the government's intelligence? It is the Centre's responsibility to secure the borders, though we condemn the terror attack," Mr Sharma's party colleague Mallikarjun Kharge said.
The origin of the terrorists is not yet clear, but Home Minister Rajnath Singh has issued a firm warning to Pakistan. "We want peace with Pakistan, but not at the cost of national honour," said the Home Minister, adding, "We will not be the first to strike, but if we are hit, we will give a befitting reply."
Mr Singh said he would make a statement in Parliament after the operation in Punjab was over.
Intelligence agencies have meanwhile issued a high alert in major cities in the country after today's attack.