Money in India:
If you decide not to shop, then the amount of money you will need will be limited to your food. If you decide to eat where local eat, then food is quite inexpensive. The nicer restaurants will all take a credit card. Thus you will need little cash.
For shopping, again the bigger shops will accept a credit card (Visa, MasterCard and Diners Club is most common, though American Express is also accepted). However expect to pay a little more when paying by credit card to cover not only the credit card fees but tax also (!).
It is best to exchange into India Rupees at either the bank at the airport when you arrive or at the hotel where you will be staying at. Shops will accept your travelers cheques, but do not expect the best exchange rates from them.
Take low denomination travelers cheques so you are not carrying a lot of money with you.