The latest increase that follows the unrelenting hike in intemational oil prices has pushed pump rates across the country to their highestever levels. While petrol is above Rs 100alitremark in all major cities, diesel has crossed that level in more than a dozen states. The total increase in petrol price since May 5, 2020 decision of the government to raise excise duty to record levels now totals Rs 35.98 per litre. Diesel rates have during this pen'od gone up by Rs 26.58 per litre. The government had raised excise duty on petrol and diesel to mop up gains that would have otherwise accrued to consumers from international oil prices crashing to as low as USD 19 per barrel. While international prices have since recovered to USD 85, excise duty has remained at Rs 32.9 per litre on petrol and Rs 31.8 on diesel. Oil Minister Hardeep Singh Puri on Friday equated demand for cutting excise duty to 'axing one's own feet', saying such levies funded government schemes to provide free COVlD19 vaccines, meals and cooking gas to millions amid the pandemic. 1. Why petrol and disel price are increasing continuosly in India? (10 Marks) 2. In the circular flow, what is the role of govt. and excise duties, considen'ng the case? (10 Marks)