principle: consider a rectangular coil. let it be help beteween the poles of horse-shoe type of magnet. as the coil rotates, the magnetic flux in the coil (or passing through the coil) changes.according to the law of electro magnetic induction, an induced current is generated in the coil. 

working: coil was initially in position such a way , the magnetic flux pass through it. when the coil is in vertical position, with side A on top and B in bottom, no current will be induce in it, thus current in the coil a that time will be zero.  when the coil is rotating in clockwise direction, current induce in it and flows from A to B. during first quarter of rotation, the current increases from zero to maximumand reaches peak value when it gets horizontal position. due to the continue rotation of coil, the current will decrease in it during second quarter rotation. and once again becomes zero comes to vertical position with side B on top, A on bottom.
during the same pattern as that the direction of the current is reversed.

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The main parts in an AC induction motor is the rotor  and the stator.In an AC motor, there's a ring of electromagnets arranged around the outside  which are designed to produce a rotating magnetic field. Inside the stator, there's a solid metal axle, a loop of wire, a coil, a squirrel cage made of metal bars and interconnections , or some other freely rotating metal part that can conduct electricity. Unlike in a DC motor, where you send power to the inner rotor, in an AC motor you send power to the outer coils that make up the stator. The coils are energized in pairs, in sequence, producing a magnetic field that rotates around the outside of the motor.
Two pairs of electromagnet coils, shown here in red and blue, are energized in turn by an AC supply). The two red coils are wired in series and energized together and the two blue coils are wired the same way. Since it's AC, the current in each coil doesn't switch on and off abruptly  but rises and falls smoothly in the shape of a sine wave: when the red coils are at their most active, the blue coils are completely inactive, and vice-versa. In other words, their currents are out of stepAs the coils are energized, the magnetic field they produce between them induces an electric current in the rotor. This current produces its own magnetic field that tries to oppose the thing that caused it. The interaction between the two fields causes the rotor to turn.As the magnetic field alternates between the red and blue coils, it effectively rotates around the motor. The rotating magnetic field makes the rotor spin in the same direction and  at almost the same speed.HOPE IT HELPS U