What Are The Effects Of Devaluation?

Devaluation reduces the export price in term of foreign currencies in the world market. As a result the exports are increased so as to increase the revenue of the country. When the exports are increased all efforts are made to increase the production of the country.
Increased demand for manufactured goods in the international market enhances incentives to the expansion of industries.
Due to devaluation the price of imported goods in term of foreign currency goes up. So the prices of the commodities are increased because of increase in the price of imported machinery and raw material. The imports are reduced.
When the revenues are increased due to an increase in exports and payments are reduced due to decrease in imports. As a result, the balance of payment of the country is corrected.
Foreigners find it cheaper to invest in devaluating country so it tends to increase the investment of foreign capital.
Because of devaluation, we have to pay more rupees in exchange of dollars. So in this way debt is increased.
Devaluation makes currency smuggling unprofitable. It also discourages smuggling of other goods.