On February 10, high drama ensued near Vidhana Soudha when a farmer from Chikkamagaluru, T.N. Vishu Kumar, carried a machete and severed a few branches of sandalwood trees planted near the legislative building.
The act was a form of protest against the National Highways Authority of India (NHAI), which had begun felling sandalwood trees cultivated by Vishu at Haliyur in Tarikere taluk of Karnataka. The land had been notified for clearance to build National Highway 206 (Shivamogga–Tumakuru).
“It is unbearable for authorities to see a few branches being cut, but, at my home, they killed over 100 trees that I nurtured for 14 years. How must I feel then?” Vishu asked.
He further stated that while the NHAI had notified the clearance of 2,148 trees on his farm, the compensation had not been decided fairly. He claimed that he ought to be compensated over ₹100 crore, whereas he was being offered only ₹1 crore.
His argument is based on the sustained and steadily rising demand for sandalwood over the decades.
| Financial year | Sales (in crore) |
| 2022–23 | ₹1,375 |
| 2023–24 | ₹1,571 |
| 2024–25 | ₹1,786 |
Globally, the estimated annual demand for sandalwood stands at 5,000 to 6,000 tonnes, according to a recent report by the sandalwood development committee (SDC) set up by the Union Government. Meanwhile, global data indicates that sandalwood prices increase by at least 20% annually.
In India, the major buyers are Karnataka Soaps and Detergents Limited (KSDL), which requires 8,000 to 9,000 kg of sandalwood oil annually for its products. Nearly 70% of this requirement is met through imports from Australia, while the rest is procured through domestic auctions, and directly from farmers.
Ironically, Australia began commercial cultivation of the Indian sandalwood variety (Santalum album L.), considered the finest variety, only in 1999. Experts attribute the current situation to the contrasting approaches adopted by India and Australia. While Australia invested years in research before large-scale cultivation, India’s approach was marred by flawed policies and restrictive laws.
According to the committee’s report, India was the world’s leading producer of sandalwood until the last century. Globally, Australia now leads the market, accounting for 69% of total sandalwood production, followed by India with a 20% share.
Despite Australian companies dominating the global market, KSDL, a Karnataka government undertaking, recorded sales of ₹1,375 crore in the financial year 2022–23, which rose to ₹1,571 crore in 2023–24. In 2024–25, sales further increased to ₹1,786 crore, highlighting the sector’s potential and the strong demand for sandalwood products.
KSDL exports a variety of products, including Mysore Sandal Soap, Mysore Sandal Gold Soap, Millennium Soap, agarbathis and talcum powder. Nearly 26 countries across the globe, including France, the United Kingdom, Qatar, the United States and Australia, import products from KSDL.
The same report reveals that nearly 75% of sandalwood in Karnataka is harvested illegally, while globally, about 33% of sandalwood is sourced through illegal means. These figures underscore not only the immense demand for sandalwood but also the need to relax laws governing its harvesting and transit. However, Karnataka is not yet ready for such changes, as officials of the Karnataka Forest Department (KFD) argue that easing regulations could pose risks to sandalwood trees in remote forests and to wildlife.
Despite global demand, KFD and KSDL officials estimate that fewer than 2,000 farmers in Karnataka currently cultivate sandalwood. Of these, 718 farmers have signed memoranda of understanding (MOU) with KSDL, under which the company provides technical support in exchange for assured procurement.
The low number of growers is attributed to high production costs, vulnerability to theft, uncertain commercial viability, and lack of research. Farmers like Vishu , however, are early adopters. He has been cultivating sandalwood on 44 acres for the past 20 years. Officials from the Indian Council of Forestry Research and Education-Institute of Wood Science and Technology (ICFRE-IWST) note that the trend is picking up in northern States, with farmers in Punjab showing particular interest in sandalwood cultivation.
This trend has coincided with signs of a collapse in commercial sandalwood cultivation in Australia, as recorded by the central committee. Meanwhile, in the Union Budget, the finance minister has announced plans to collaborate with States to revive the sandalwood industry in India.
At the same time, ICFRE-IWST has been studying fast heartwood-producing varieties by collecting samples from across the country to develop varieties that can mature more quickly and be commercially viable for farmers. Yet, the question remains: how viable is sandalwood cultivation for Indian farmers?
Why is sandalwood in demand?
According to the central committee report, the primary beneficiaries of sandalwood include the perfume industry, indigenous medicine systems, attar producers, and Ayurvedic medicine because of its therapeutic properties. The report also notes that Indian sandalwood contains a higher percentage of essential oil compared to other sandalwood species.
Arun Kumar, a scientist at ICFRE-IWST, explained that sandalwood oil serves as an ideal base for perfumes. “When sandalwood oil is mixed with other fragrances, it does not overpower them. Instead, it forms a strong base that allows the individual notes of both fragrances to be retained,” he said.
Summing up, he added, “The perfume industry has existed for centuries, and many commercial oils today are synthesised through chemical combinations. Even now, there is no chemical formulation that can completely replicate the original fragrance of sandalwood.”
Reasons for the decline in sandalwood production
Excessive harvesting in the early years
Illegal logging and smuggling
Habitat loss due to deforestation
Slow growth and long maturation cycle
Regulatory challenges in cultivation amid shrinking habitats
Pests and diseases
The economics of a 20-year gamble
Sandalwood is a long-duration crop, taking nearly 20 years to develop quality heartwood, which is the primary source of sandalwood oil. Some trees are harvested after 15 years, but for farmers, the investment has been a gamble, as there was no reliable way to assess heartwood development in advance, risking total loss.
Prashanth P.K.M., Managing Director of KSDL, said the price of sandalwood ranges from ₹3,000 to ₹15,000 per kg, depending on heartwood quality, which is categorised into 18 grades.
Moreover, from 1,000 kg of raw wood, only about 100 kg of heartwood remains after processing. Limited heartwood development further reduces returns. According to an ICFRE-IWST estimate, a farmer can earn a net income of ₹1.06 crore per hectare after deducting expenses incurred over 15 years, which amount to ₹28 lakh.
The high demand has also made sandalwood highly vulnerable to theft. KFD data shows that around 4,500 forest offence cases are registered annually, of which 450 to 500 involve sandalwood theft. Officials say this figure represents only a fraction of the actual problem. There have been instances of forest officials allegedlycolluding with smugglers. The severity of the issue prompted M.A. Saleem, Director General of Police, to issue a circular in 2025, directing the police to mandatorily register sandalwood theft cases, and investigate any nexus that emerges.
On-field challenges
Vishu , who owns 44 acres, spends at least ₹1 lakh every month on security alone. “I have guards working on the farm in two shifts every day, and there is CCTV coverage as well. The farm is electrically fenced, and regular security checks are carried out,” he said.
Doddamagge Rangaswamy, a progressive farmer from Doddamagge in Arakalgud taluk of Hassan district, has cultivated sandalwood on more than 200 acres of his total 500-acre plantation.
Rangaswamy has dealt with several theft incidents on his plantation. “The entire area is secured with a 12-foot-high chain-link fence. There are multiple watchtowers along the fencing. In the second layer, there is solar fencing. The gap between the two fences is wide enough for a vehicle to pass,” he said.
He has provided security guards with vehicles and licensed weapons. In addition, he keeps dogs. “Despite these security measures, people attempt to enter. So far, they have not succeeded on a large scale,” he said.
Rangaswamy removed Hebbevu, which was planted as a host plant, as it grew taller than the sandalwood trees. He has now replaced Hebbevu with grafted jackfruit and macadamia. He maintained that the yield from trees that are very well cared for is not satisfactory.
Bachhe Gowda, a farmer from Mallasandra in Kolar taluk, cultivated sandalwood on five acres and maintained it for over 19 years. “Considering the investment we made to cultivate sandalwood, the returns after harvest are meagre. Despite proper fencing, we could not protect our farm from thieves,” he said.
“I have decided not to recommend sandalwood cultivation to any farmer,” he stated. His family is now exploring options to use the land for non-agricultural purposes.
However, Arun Kumar said there is a misconception that sandalwood grows only in harsh conditions. “It is a crop that can be irrigated and nurtured as well. Farmers who grow sandalwood need training and information on how to go about it, and can get trained at ICFRE-IWST,” he said, adding that there is a need for greater awareness about commercial sandalwood cultivation.
KSDL’s sandalwood oil requirement vs supply
Sandalwood oil required: 8,000–9,000 kg
Imports from Australia: 70% of total requirement
Procured through domestic auctions: 20–25%
Purchased directly from farmers: 5–10%
The absence of proven models
A senior IFS officer from the Karnataka Forest Department (KFD) pointed out that there is no example or research on successful commercial cultivation of sandalwood under Indian conditions. Even a central committee report cites the lack of examples of farmers successfully growing sandalwood.
“When there are no examples and no corroborative research, advising most farmers to grow sandalwood will lead to disasters,” the officer explained. In simple terms, she said a small or middle-class farmer with four to five acres of land, who supports a family through mixed cultivation, cannot afford the risk.
“In such cases, the farmer has to dedicate a few acres and about 15 years, which means their regular income may reduce. For small farmers, this is extremely risky. Research must progress first before recommending large-scale commercial cultivation,” the officer said.
However, she added that limited cultivation, such as planting along farm boundaries, without maximum risk could be a good investment, provided the issue of theft is addressed.
To tackle theft, ICFRE-IWST has worked on chip-based technology with video coverage that can be embedded in trees. However, this technology also requires substantial investment by farmers and is currently being promoted by private players.
One of the demands from farmer groups is a subsidised price for these chips so that small farmers can also afford them.
Mr. Arun put it this way: “When reviving a species like sandalwood, it should not be limited to elites. Efforts should be made to conserve and popularise sandalwood even among small farmers.”
The harvest bureaucracy
K.T. Gangadhar, president of the Karnataka State Farmers Association, said that apart from cultivation challenges, harvesting and transportation have become major hurdles for farmers.
Although there is no restriction on growing sandalwood, farmers must obtain permission from the Forest Department to fell the tree, as it is classified as a forest crop. “A farmer has to make a hundred trips to the forest office. Later, during transit, even with permits, officers harass farmers,” he said. “There have been cases where forest officers inform poachers after an application is filed,” he alleged.
But the IFS officer said relaxation of rules would be highly risky.
“Look at sandalwood theft statistics (about 450 cases a year), which show how frequently such thefts occur, and this is only the tip of the iceberg. If rules are relaxed, forest property will be at risk,” she said. “Along with sandalwood, wildlife will also become easy targets for poachers.”
However, she noted that the government should consider developing a separate system that eliminates in-person approvals for harvesting and transit.
Beyond this, sandalwood farmers and aspirants seek have sought special insurance for trees, research-backed training, and the development of mixed cropping systems with sandalwood.
If the Union Budget’s promise on sandalwood addresses these gaps, the tagline of the Karnataka Soaps and Detergents Limited (KSDL) — Grow sandalwood and be rich—could become a reality.
With inputs from Sathish G T in Hassan.
