India led 2-0 and then 3-1 but allowed Belgium to come back in the last 15 minutes to 4-3 through a last minute goal by Florent van Aubel.
"We had the match in control but just gave it away. We were just a game away from making it to the Champions Trophy which would have been a big boost," said Nobbs, shaking his head in disappointment as the Indian defence failed to keep Belgium's striker at bay.
"It is very disappointing not to have won today after having things under control at 3-1 in the second half," he said.
Seeking to repeat their 2001 title win in the Champions Challenge, India scored through V R Raghunath (23rd minute) and Sandeep Singh (39th), gaining a 2-0 lead.
India were again 3-1 ahead when Shivendra Singh (53rd minute) scored a field goal.
Belgium struck back through Jerome Dekeyser, who scored two field goals in 45th and 57th minutes, while Gauthier Boccard penetrated the Indian defence with a fine deflection in the 55th minute.
Belgium's two goals from 1-3 down came when India were down to 10 players as Raghunath had been shown the yellow card for a deliberate obstruction, leaving gaps in the defence that the strikers capitalised on to create openings.
"Raghu's yellow card has cost us dearly, we have to learn to be able to deal with these situations and avoid mistakes like this," said Nobbs.
But India were back in full strength when van Aubel capitalised on a defensive lapse, leaving him unmarked and with time to execute the shot that made the vital difference between the two sides.
Nobbs said India will take several positives from this outing.
"We take several positives from this tournament, and also that we need to make improvements before the Olympics Qualifiers," said Nobbs.
"It is better we learn from our mistakes now than in the Olympic Qualifiers," he said.