Meaning of a paragraph related to economics Until early 2016, India’s growth had been accelerating when growth in other countries was decelerating. But then the converse happened. The world economy embarked on a synchronous recovery, but India’s GDP growth—and indeed a number of other indicators such as industrial production, credit, and investment—decelerated. There are five reasons for this:

• First, India’s monetary conditions decoupled from the rest of the world. Until the middle of 2016, real policy interest rates were following the global trend downwards. Since then, the downward drift has continued in most other countries, with rates falling. But in India, for the same period, average real interest rates increased. This tightening of monetary conditions contributed to the divergence in economic activity in two ways. First, it depressed consumption and investment compared to that in other countries. Second, it attracted capital inflows especially into debt instruments, which caused the increase in demand for rupee and consequently rupee appreciates which causes dampening of exports. 

Can anyone please explain what is written in bold in layman's terms?
This means that interest rates rose in India at the same time that they stayed relatively low in other areas of the world. The fact that investors could get a higher yield in India led to an increase in demand for their currency (if I can get a 5% yield on Indian bonds, why would I get a 2% yield on US bonds?) This led to an increase in demand for their currency so that investors could buy Indian bonds/Invest in India at higher yields. The appreciation of the rupee (increase in value) led to India’s goods costing more (it took more dollars to buy Indian goods for example due to the currencies rise in value). This led to fewer goods being demanded (higher prices decrease demand). So Indias exports declined.