Chasing 221 for win, Pathan hammered the South African bowlers to all parts of the park to bring India back in contention after the visitors were reeling at 93 for five at one stage.
"Yusuf Pathan`s knock was the difference. The pitch was very two-paced and also up and down. It was not the best one-day wicket I have ever played on but it made for an exciting game," Smith said.
"It is terrific to see a guy like him come in. He had a good domestic season and just to carry that on here is good.
He has prepared well, I have watched him in training. He will bring a lot to the squad I think.
"It was great to see him and play that well. Especially under pressure. We were under pressure when he came in. I think he has something special, which is good," he added.
Smith said the third powerplay robbed South Africa off a good score and they fall short by 20 runs.
"I think 220 gave us a chance. The wicket was very difficult to bat on, had sort of plates on it, and its two-paced nature made strokes very difficult. It also had up and down bounce," he said.
"We were really hoping for 240. I think 240 would have been a really good total there. JP Duminy and debutant Faff du Plessis played well together to take us to a decent total. Our Powerplay was poor again, we lost JP and Faff within two overs, and we only got 19 overs in our last six overs.
"I really felt if we got 240 we were in with a real good chance of winning the game. We came real close, we missed two crucial chances at the back end, but I can`t fault the guys` commitment tonight, their intensity and the effort they gave," he added.
Smith said the team needs to keep doing the right things to bounce back after such close defeats in back-to-back games and hoped the World Cup squad announcement will also ease the pressure on his boys.
"I think it`s always important to keep doing the right things at training," he said.
"Keep reiterating the same point. The margins have been so small in the last two games, we could easily be 2-1 up or 3-0 up. Just got to keep training hard and keep doing the right things and hopefully the things will kick into place.
"The World Cup squad comes out tonight, that will ease a lot of minds and stress on players. Hopefully free up a lot of players, and make them play with sort of freedom in the next few games," he added.