He also said that the neighbour is still trying to weaken country's economy by pumping fake Indian currency notes.
"We launched the economic reforms in 1991 and subsequently India had achieved rapid economic progress. But a neighbour became envious of our development. Soon, there were 13 blasts in Mumbai (in 1993)," he said, addressing the 'Agenda-Aaj Tak' programme in New Delhi organised by TV Today Group.
Shinde said all fugitive terrorists, including the 1993 Mumbai blasts mastermind Dawood Ibrahim, would be brought back to India and punished for their crime.
"Not only Dawood but other terrorists sitting in safe havens will be brought back to India to face trial. We are working with some international organisations," he said.
Last month, addressing the Interpol General Assembly in Rome, Shinde had said the masterminds of the heinous serial blasts are sitting in safe havens in Pakistan, which has taken no action against them despite being provided with credible evidence.
Referring to circulation of fake Indian currency notes, the home minister said the nefarious design was being carried out by a neighbouring country to destroy India's economy.
"We are taking a number of steps to check the menace as economic security is paramount," he said.
The home minister said Interpol must take certain steps to apprehend those fugitives who are sitting in safe havens and getting official patronage.
Shinde said after the 2008 Mumbai terror attack, the government has strengthened its intelligence gathering mechanism and was now in a better position to deal with terrorists in comparison to what it was to a few years ago.
"Due to increased vigil, we have been able to bust 19 terror module in 2012," he said, adding intensified vigilance was also helping security agencies to track down terrorists.
Shinde said so far the central government has spent Rs 12,000 crore for the modernisation of police forces and another Rs 5,000 crore will be spent for the purpose in the next five years.