Since the middle ages, pale skin has been associated with the aristocracy. Originally, the landed nobles in Europe did not have to work their land themselves, but had peasant tenants or serfs to do it for them. Each member of the peasant family, including the women, had to physically work from dawn to dusk in order to keep themselves fed. This mostly involved farming and outdoor work: the peasant family was generally sunburnt and developed leathery skin fairly early in life. The aristocratic family, on the other hand, did not have to work in the fields. The only member who was actually required to leave the keep or castle or what have you was the head of the household, the noble himself. He had to take care of various vassal-oriented responsibilities, such as overseeing the land or raising armies for the king, neither of which were exactly indoor sports.
So the men went hunting, visited other nobles, or paid tributes. Most of the time, however, their wives and daughters did not leave the keep. As they did not take care of any business, they had no reason to go. They certainly did not have to work on the land all day: their families were rich enough to support them. They stayed in the solar and embroidered genteelly. Thus a white satin skin, especially in women, came to be seen as evidence of one's social and economic status.
By the 17th century, the cultivation of such a pallor was in the height of fashion, especially in the extremely appearance-based high culture of Louis XIV France. Ladies took great pains to keep themselves pale naturally, but sometimes resorted to such tactics as tastefully used powders and paint in general. Prostitutes began to use these tactics as well, but with much greater abandon. It was not fashionable, after all, to look like a fake in actual high society, but in fantasy, anything goes.
By the 1800s, pallor had also become associated with wasting illnesses. These illnesses, most often tuberculosis, became stock gothic novel tactics to keep the heroine tragic and pure (see Victorian Novel Disease). The whiteness of the skin during the course of such a disease came to symbolize virtue as well as ladylike and aristocratic qualities. This led to the romanticization of disease: not just whiteness was aristocratic, but a frail appearance, no flesh on the bones, etc. This association with disease may have led to the goth movement's desire for pallor today.
In the American west, as you may have read in the Little House on the Prairie series, there was conflict over the degree of paleness of one's skin as well. Proper young ladies were supposed to stay inside and make quilts or cook; one might be referred to as "a wild Indian" if one had been running around outside or doing boys' instead of girls' chores. The conflict functioned not only in terms of class but of race and sex. If one was not pale, one was a savage or a tomboy. This racial conflict may easily have come into play in India under British occupation as well.
Of late, pale skin has become associated more with various geekery and gothdom than anything else. Those who stay out of the sun are often characterized as unhealthy, having bad posture, etc. They stand in harsh contrast to the athletic and very tan indeed beachgoers (popularized in part by Annette Funicello and Christie Brinkley) who have the leisure not to stay inside and embroider, but to lie in the sand all day getting melanoma.