This means "By one more than the previous one"
I am sharing one example where this sutra is applied.
Finding the square of a number ending with 5.
65^2
= [6 X (6+1)] 25 = 4225
For this number , the last digit is 5 and the 'previous' digit is 6. Hence, 'one more than the previous one', that is, 6+1=7.
The Sutra, in this context, gives the procedure 'to multiply the previous digit 6 by one more than itself, that is, by 7'. It becomes the L.H.S of the result, that is, 6 X 7 = 42. The R.H.S of the result 25.
85^2
= [8 X (8+1)] 25 = 7225
For this number , the last digit is 5 and the 'previous' digit is 8. Hence, 'one more than the previous one', that is, 8+1=9. The Sutra, in this context, gives the procedure 'to multiply the previous digit 8 by one more than itself, that is, by 9'. It becomes the L.H.S of the result, that is, 8 X 9 = 72. The R.H.S of the result 25.
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