While Islamabad accused Cameron of inferring from "self-serving reports", Downing Street clarified that the PM was not accusing the Pakistan Government of sponsoring terrorism but had pointed out that official agencies in Pakistan were responsible for harbouring terrorists.
The diplomatic row started off when Pakistani High Commissioner to Britain Wajid Shamsul Hasan accused Cameron of damaging prospects for regional peace ahead of Pakistan President Asif Ali Zardari's visit to UK next week.
"One would have wished that the prime minister would have considered Pakistan's enormous role in the war on terror and the sacrifices it has rendered since 9/11...There seems to be more reliance on information based on intelligence leaks which lack credibility of proof," he wrote in The Guardian.
Cameron, who is on a visit in India, on Wednesday, Jul 28 launched a scathing attack on Pakistan saying that it could no longer "look both ways" by tolerating terrorism while demanding respect as a democracy.
The second Pak response came from Pakistan Foreign Ministry spokesman Abdul Basit.
Speaking to Radio 4's World at One, Basit said, "There is no question of Pakistan looking the other way. I think the Prime Minister was referring to these reports, which are unverifiable and outdated. If we start drawing inferences from these self-serving reports, then obviously we are distracting ourselves."
However, Downing Street came to the rescue of the Prime Minister recalling the statements he made after the verbal attack.
To a question if he believes that Pakistan exports terrorism, Cameron said, "I choose my words very carefully. It is unacceptable for anything to happen within Pakistan that is about supporting terrorism elsewhere.