Lara remained unbeaten on 60 as the West Indies, replying to India's moderate 242-6 from 50 overs, cruised to an easy victory with three overs to spare.
Swashbuckling opener Philo Wallace led the charge with an aggressive 39 off 45 balls. Left-hander Shivnarine Chanderpaul made 74.
The West Indians return to the National stadium on Sunday to take on Hansie Cronje's South Africa in the final worth 100,000 dollars to the winners.
India, who surprisingly chose to bat in overcast conditions, found themselves in a bind after losing master batsman Sachin Tendulkar and skipper Mohammad Azharuddin by the sixth over.
The West Indies, on the other hand, made a blistering start as Wallace lofted Javagal Srinath's first delivery over the long-off fence for six.
The first two overs produced 27 runs, and even though Stuart Williams was dismissed in the third, Wallace and Chanderpaul continued to pile up the runs at a hectic pace.
It was 61-1 after the first seven overs and the pair brought up the 100 in the 15th over.
Indian captain Mohammad Azharuddin turned to Tendulkar in frustration, and the little genius struck with his second delivery when he deceived Wallace to set up an easy return catch.
Tendulkar, mixing off-spin and leg breaks shrewdly, struck another valuable blow in his fifth over when he bowled Chanderpaul with a slower ball in the 25th over.
The West Indies found themselves under self-inflicted pressure when Carl Hooper holed out against Anil Kumble in the next over to make it 156-4.
But Keith Arthurton (40 not out) put on 89 for the fifth wicket with Lara to ensure the West Indies a comfortable win.
Earlier, Saurav Ganguly and Robin Singh fought bravely to help India recover from the shaky start.
Left-hander Ganguly shored up the faltering top-order with a defiant 83, while Singh lashed out at the end to remain unbeaten on a gutsy 73 off 63 balls.
Singh and wicket-keeper Nayan Mongia hit 84 off 64 balls for the sixth wicket after India were reduced to 152-5 in the 39th over.
Singh, who hit five fours and three sixes, took 18 runs off the 47th over bowled by spinner Raul Lewis and with Mongia added 13 from the 49th by Carl Hooper.
Tendulkar, who made 141 against Australia in the quarter-final, managed just eight when he departed to a brilliant diving catch in the slips by Hooper off fast bowler Mervyn Dillon.
Dillon also trapped Azharuddin leg-before for one, but it was new ball partner Reon King who stole the show on his debut by conceding just 26 runs in an unchanged spell of 10 overs.
King, a last-minute inclusion in the squad after Curtly Ambrose pulled out for personal reasons, worked up bounce and movement on the seaming wicket to trouble the batsmen.
The dour Rahul Dravid helped Ganguly add 70 for the third wicket, but the partnership that lasted 20 overs reduced India's run-rate dramatically.
Ganguly, who helped himself to two sixes in one over from Keith
Arthurton, fell 17 runs short of a century when he was stumped off
a wide ball from Raul Lewis in the 39th over.
Date-stamped : 31 Oct1998 - 18:32