What do you mean by devaluation of currency Devaluation

SOLUTION

Devaluation means the lowering the value of country's currency in terms of other currencies by statuary body. In 1991, as an immediate measure to resolve balance of payment crisis, Indian government has devalued the rupee. If previously one $ was worth 40 rupees now it became 42 rupees. With devaluation a country's exports become cheaper and imports become more expensive. Devaluation leads to increase in exports and thereby foreign exchange.