When shopping in India there are a few things to be aware of.
MRP (Maximum Retail Price)
Most small goods (cigarettes, water, pre packaged grocery items and snack foods) will have a price stamped somewhere on the packet. Look for the MRP stamp on the bottom or side. In some out of the way places, people may try to charge you an extra rupee to cover the cost of transport. Most people don't mind to pay this, but you are well within your rights to insist on the MRP.
Be aware that most things can be bargained for in India. Bargaining is almost like entering into a relationship with the seller. If you pay the first price then they will not respect you in the morning. If you bargain for something that you have no intention of buying this is considered very impolite.
When you ask "How much?" the bargaining is said to have begun.
The shopkeeper will mention an outrageous price to which you respond in a shocked and sorry manner. Shake your head and say "Arrree Baba! I am not the Goddess of Wealth!"
The shopkeeper may then ask what price you would offer for his goods.
You would then offer about ten percent less than what the goods are worth to you and allow him to bargain you up in increments to your final price.
Photo credit: http://vasa-project.com/blog/wp-content/uploads/2011/01/Haggling.jpg