First of all, the Pacers gave up virtually nothing. Yes, the next draft is supposedly deep, but the Pacers are likely to finish with around the 10th best record in the league, meaning they are essentially giving up a pick that would land somewhere in the 50s. There aren't going to be many players who can provide much of an impact, immediate or otherwise, at that spot.
Secondly, with the Pacers being below the salary cap, Barbosa is not a financial burden, especially as his $7.6m contract comes off the books at the end of the season. This means at worst he is just a short-term insurance policy.
Thirdly, Barbosa can still play and fills a much needed role on the team -- bench scoring. The Pacers bench sometimes looks great. Other times it can be brutal. Think about it. George Hill is the number one bench option, and he can be a very good one, but he has missed games with injury this season and if anything happens to him, their next best option is Tyler Hansbrough. As much as I like Psycho-T's energy and hustle, he has been downright terrible for the majority of the season. He can be effective given the right matchup but let's admit we're always surprised he has a good game these days. Apart from those two, who's left? Dahntay Jones? AJ Price? Don't make me cry.
Barbosa is a former 6th man of the year winner and is averaging 12.2 points this season for the Raptors, a team without much motivation to play for. Like George Hill, Barbosa isn't a true point guard and not much of a passer but can flat out play. He may have lost a step or two at 29 but he is still one of the quickest players in the league. I love his ability to slash and get to the hole, something the Pacers desperately need. In fact, he may instantly become the team's best slasher, and he can finish at the rim consistently unlike say Darren Collison, who is just too small. I like the fact that he adds a new dimension to the team and especially its flimsy bench.
Some have expressed concern over whose minutes Barbosa will be taking. It's not going to be Paul George or George Hill. If anyone, it'll be AJ Price and Dahntay Jones. And I think we can all agree: the less minutes for DJ the better.