I think that shopping in India is something like experiencing the country in a nutshell. Depending on what you want, where you go, with whom you go and how you look the experiences are very different.
For example, I (gori) going to buy mangos at the street stall. Price: 120 rupees per kg. My SIL goes 5 min later: 12 rupees a kg!! That's 10% of the price!! My FIL walks over to his daughter and simply gives the salesman 10 rupees (for a kg) and walks away, issue settled. Now, I've traveled around quite a bit and hagling is something that I've come to accept as normal, but I am yet to find a place where it is more pervasive than India. Here even shops that advertize set prices will be open for negotiation and the sign seems to sit there only for the extra lazy customer to convince himself it is ok to pay the price given.
But many times I am this lazy customer. When I've been sitting in a store for over an hour, picking stuff, trying clothes on, etc I really don't feel like haggling. I admit shopping is not for me, so I usually just want to get over it... which is not the recommended state of mind when going to the counter to negotiate. It just seems like such a waste of energy! The vendor, on the other hand, feels like the haggling time is his time to show off all the drama he's learned over the years, so if you don't haggle he will almost surely be disappointed. I think the art of haggling is an intrinsic way of overcoming social barriers in India and showing off some skills: be prepared!