The sandalwood policy of the Tamil Nadu and Karnataka governments have created just the right environment for corruption to thrive. It involves major kickbacks for all those involved, it leads to scarcity of the raw material and promotes black market trade. The powerful and the corrupt corner the bulk of the profits and would like to see status quo maintained.

The sandalwood tree, valued for its oil and wood, needs to be protected, argue the governments. Otherwise the local population will convert every sapling into a carving and sell it. The ministry of environment and forests even banned sandalwood export in 1992. But these laws are today pushing the tree towards extinction.

Farmers would have cultivated sandalwood to sell for a huge profit if the market were free. The increased supply of sandalwood would have led to a drop in prices eventually. But sandalwood today is a nationalised tree and the market is controlled. The result: if local farmers see the tree growing on their land today they immediately uproot it. If they don't they would have to guard it with their life without getting anything in return because it belongs to the government. When the tree is cut, the government will pay them a paltry amount way below the prevailing price. As a result, there is an acute shortage of sandalwood. Black market rates for sandalwood were as high as Rs 2 lakh for one tonne in 1993. A briefcase with 10 kg of sandalwood would sell for Rs 4,000. In such a situation, a sandalwood smuggler like Veerappan thrives. And the government is neither able to protect the tree in private lands nor in government forests.

Veerappan's game of hide 'n' seek is, in the ultimate analysis, a product of state policy. To end it, all that is required is a decision to free trade in sandalwood. Both the black market and the bandit will die overnight. Till then it is the poor sandalwood carvers, the artisans, whose intricate carvings are valued worldwide, who will suffer from the "nationalisation" of the tree. While smugglers flourish, these artisans are starved of wood. And sandalwood is becoming endangered.

Interestingly, scientists at the Bangalore-based Institute of Wood Science and Technology noted that if adequate protection is given to its habitat, the tree can be sustainably harvested.