Firstly, Modi and Vajpayee are very different. Vajpayee was a bit of a idealistic dreamer who saw himself as a liberal Hindu. While their political beliefs were different, he was personally someone in the mould of Nehru. Modi is a hard headed pragmatist.
Secondly, after Mushy did Kargil behind India's and Mian Sahab 's back, the Indian establishment knows that just the Prime Minister of Pakistan does not have the authority to negotiate peace with India and any concessions India makes will be exploited by non -state actors and the Pakistani establishment will claim ignorance or inability to control them. Basically, there is very little confidence in the Pakistani establishment's willingness and/or ability to deliver on a peace deal. Because of what happened after Vajpayee's bus ride to Lahore, the Indian public is also not too enthusiastic about making concessions about a peace deal, even though they will appreciate the peace dividend. The bottom line is that after the Kargil episode, the peace constituency in India has been significantly marginalized and if Pakistan wants normalisation of relations, it would pretty much have to be on India's terms because India doesn't mind the status quo continuing.