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I also wanted to know the difference in terms of sourcing the setup files in both these folders . How can i know when to source the files from devel space and when from install space

From the page I linked to:

Once targets are built, they can be installed into the install space by invoking the install target, usually with make install

If all packages in your source space have the required install(..) directives in their CMakeLists.txt, then there should be no difference between the devel and the install space, when running nodes from those packages.

For normal development though, I'd always just use the devel space (name sort of implies that). The install space is typically an 'end-station': you use it for deployment.