Agreed, over confidence is the big mistake that Indian team had. During the days before the match of India majority of the media took this into discussion. The headlines were something as will Pakistan withstand the performance of India. This hype given by media too is a reason for having over confidence.
West Indies in the past have faced similar situation in 1983 world cup finals against India. The score was just 183 which was is reachable, but the over confidence made them loss the match scoring 140. By that time West Indies is the top team.
The BCCI doesn't allow Indian players to participate in franchise cricket leagues around the world, which limits their exposure in a big way. On the other hand, Pakistani cricketers play in various leagues all around the world, and as a result they are familiar with the ground conditions and weather. But at least a part of the problem lies with the Indian selection policy. Kohli and the coach went for unfit players like Hardik instead of more deserving players, because they want to include their proxies in the playing XI.