Carrying Cash is perhaps the very best way while travelling abroad. However, it is prone to be stolen, which in any case, anything might be. Carrying cash makes it easier for you to handle your expense, buy anything that you suddenly liked and have a comfortable journey in India.
Exchanging money at the airports would not be a good deal as they offer the worst exchange rates. So, rather opt for authorized dealers which you can easily find in the metro cities in India, to exchange your cash in Rupees. You can carry US Dollars but it would make it difficult during tipping and paying for miscellaneous costs. So, better carry Indian Rupees with you.
The smartest way, for sure, is to carry your international credit or debit card so that you can easily withdraw money from the international ATMs, depending on the exchange rate for that date. We would recommend that you pay by cash only, as you go for shopping in the local stores because most of them would not have the credit/debit card swipe facility and also, you end up saving the tax conversion.
So, be smart and manage your money wisely as you are set to discover the true beauty of India.