Question

What is devaluation? Why rupee was devalued in 1991?​

Answer 1

Answer:

The 1966 devaluation was the result of the first major financial crisis the government faced. As in 1991, there was significant downward pressure on the value of the rupee from the international market and India was faced with depleting foreign reserves that necessitated devaluation.

Answer 2

$\sf{Devaluation \: of \: the \: (domestic) \: currency \: occurs \: when \: the }$

$\sf{value \: of \: the \: domestic \: currency \: is \: deliberately \: reduced \: by }$

$\sf{the \: government \: by \: raising \: the \: exchange \: rate. \: The \: market }$

$\sf{forces \: of \: supply \: and \: demand \: play \: no \: role \: whatsoever.}$