The relationship between the values of local currencies in terms of foreign currencies and export competitiveness of any country is very complex. This relationship will become more complex if there is the heavy dependence on imported resources in the exported products. During last five years Indian rupee has weakened many times and reached to a level of 65.1806 for a dollar in March 2018. Since April 2013, the local currency lost around 18% to the US currency. Indian economy which as of now experienced vast financial and current account deficiency unfavorably influenced by exchange rate pressure. This paper endeavors to investigate the impacts of exchange rate movement in India and its effect on the Indian economy. The conditions which have been made for the economy because of the devaluation of rupee against dollar uncovers that there has been a solid and critical negative effect of this money unpredictability on numerous sectors.