The overhang close to the edge of the waterfall is obscured by thick grass and trees, which makes it impossible to see fully inside. "It is places like this that the tiger is looking for," says Sreenivasa Murthy, the park director of the Panna Tiger Reserve in Madhya Pradesh. "This is prime tiger habitat."

In the trees behind the overhang there is movement. Something is bending the branches, disturbing the tropical foliage. Almost certainly, it is a member of a troop of langur monkeys we disturbed just moments earlier. But perhaps it is something else. Perhaps...

It is very rare to see a tiger in India today, even if you are looking in the right place. From an estimated population of around 100,000 at the turn of the 20th century, the official number now stands at a little over 1,400 animals. Many experts believe the actual size of the population may even be as few as 800.

Over the past 100 years, tiger populations across the world have fallen by as much as 95 per cent; there may now be as few as 3,000 tigers left living in the wild. Of the nine sub-species, three – the Caspian, Javanese and Balinese – are already gone. A fourth, the South China tiger, is currently considered "functionally extinct".

The key reasons for the astonishing, fatal decline of this remarkable animal – as leaders from the 13 so-called "tiger range countries" will ponder when they meet next week in St Petersburg – are simple: an unceasing and lucrative illegal trade in tiger parts and pelts for Chinese "medicine", and the destruction of tiger habitats as human communities continue to expand and spread. Beyond that, there is corruption, excessive bureaucracy, questionable expertise and even a selective blindness that prevents the authorities from fully accepting that the world is on the brink of seeing one of its great species slip into extinction.

The story of the Panna Tiger Reserve in Madhya Pradesh, the state in central India that inspired Rudyard Kipling to write The Jungle Book – Shere Khan was a Bengal tiger – is a microcosm of the large cat's broader struggle for survival in an increasingly urbanised world. In 2002, it was estimated there were at least 35 animals in the park. In the following five years, there was a rapid decline as poaching soared, with the park authorities unable to either stop the poaching or even admit it was happening. In 2005, the man who then headed the park said its tiger population had never been healthier.

But after whistleblowers repeatedly revealed the steady erosion of the animals, a new census was carried out and, in the summer of last year, the authorities were finally forced to reveal the news that stunned wildlife activists across the world: there was no longer a single tiger in the Panna reserve. Wildlife officials claimed there was no "explicable reason" for their demise, but activists had been issuing warnings for years. "It's a national disgrace," said Shehla Masood of the Udai Society, a local activists' group. "The shrinking numbers of tigers in India shows the apathy of the Indian government which cannot protect citizens, let alone tigers."

Yet given all the challenges they face, tigers are remarkably resilient. In the aftermath of the Panna debacle and the attempt by the authorities to cover up what had happened, a new management team set about trying to turn the reserve around. Last November, three adult tigers – one female from Kanha reserve, another from Bandhavgarh, and a male from Pench – were flown in and released inside Panna. Within days, park rangers reported that the male had mated with the Bandhavgarh female. On 15 April this year, staff watched as the female made several trips from her den, emerging with what looked like soft toys gently held in her mouth. She had given birth to four live cubs.

On the verandah of a forest department-owned bungalow on the edge of Panna's tiger reserve, Sreenivasa Murthy pulls up a map of the park on his laptop. Appointed field director last year and tasked with trying to fix damage that appeared irreparable, his domai of forest and table-top plateau stretches over 542 sq km. The southern, eastern and northern boundaries are all susceptible, he says. The Ken River, which bisects the park from south to north as it makes its way to join the Ganges in the city of Varanasi, is one particularly easy way for poachers to enter. In his role as a state official, Murthy has to employ the skills of a diplomat and politician as well as those of a park director. While a central government report published last year into the reasons for Panna's tiger extinction blamed poaching, the state government did not reach the same conclusion. He does not deny poaching is a problem, but he says that it is not the only issue.

Murthy believes the park should remain a sanctuary, with humans banned from its inner core. A total of 16 villages had existed inside the park, of which 11 have been relocated. He wants all of them moved. At the same time, he believes it is important to reach out to local communities and build a relationship. If a tiger should kill a cow or other livestock, it is vital, he says, that park officials are quickly on the scene to pay compensation. Otherwise, local communities could take it into their own hands, using easily-obtainable poison to kill the tiger.

Not everyone agrees with his approach. Some conservationists argue that keeping local people out of the forest and preventing them from hunting and collecting firewood only creates anger. As such, they are less likely to respond to requests from officials to help protect the animals. Yet Murthy believes it is possible to have it both ways if there is a sufficiently strong political will. "At the moment, the support for these communities is not there," he says.

In the meantime, the director spends much of his energy ensuring that his tigers do not slip from the confines of his park. Of the three adult tigers in Panna, the radio collars on only two of the animals are working, so it is a challenge to keep track of the third big cat. Using walkie-talkies to maintain contact with 30 staff dedicated to monitoring the animals, he tries to know where the tigers are at any time of day or night. And should it become apparent that one of the tigers is approaching the edge of the reserve, teams are dispatched to disturb the animal and drive it back into the relative safety of the forest.

Lokendra Singh holds up a small black-and-white photograph taken in 1956 that shows a young boy holding a British-made .350 Rigby rifle and standing behind the body of a dead tiger. Another photograph, taken in 1960, shows the same boy with the bodies of three animals. "I remember the evening that I shot those tigers. I was standing on a rock at the mouth of the cave and the family of tigers came out one by one and I kept on shooting," says Singh, a member of the royal family of Panna and uncle of the current maharajah. "Nowadays it looks very bad, but back then people used to say, 'You cannot be a proper Rajput unless you shoot tigers'."

The same evening, says Singh, a former state politician and member of the national parliament, he decided he would fight to save tigers instead of shooting them. When he became a member of the state assembly in 1977, one of the first things he campaigned for was the establishment of the Panna reserve. His wish became reality in 1981 and he was the founding chairman of the park's advisory board. He remains an active conservationist.

These days, explains Singh, Panna's tigers are not being shot by gun-toting members of India's aristocracy, but by teams of professional poachers who belong to nomadic tribes that have a hunting tradition dating back centuries. For an adult tiger, the poachers will earn around 250,000 INR (around £3,440), a vast sum of money in this part of the world.

The method for catching the tiger is simple but lethally effective. The poachers set their steel-sprung traps at night on paths not patrolled by forest officers. They then retire, hiding in platforms they have built amid the jungle. When an animal is trapped, they will cautiously approach, stabbing it in the mouth with a pointed stick or stuffing it with earth to silence the tiger's cries. Rather than risk damaging the valuable pelt by using a gun, the men then club the tiger to death, often with bamboo poles filled with metal. The tiger will often be skinned shortly after dawn. Some of the animal's organs, among them the highly-prized penis, will be removed and the skin will be treated with turmeric and salt to cure it. The carcass itself may be buried, with the hunters returning a week later to collect the bones once the flesh has rotted away. "It's professional poaching and it's going on across India," says Singh.

The people suspected of being responsible for the demise of the tigers in Panna are the Baheliya tribe, one of two traditional hunting communities blamed for poaching tigers, lions and other endangered species in parks across India. Originally from Katni in Madhya Pradesh, the tribe is now scattered. Undercover investigations suggest most of the 35 tigers lost in Panna between 2002-2008 were killed by a small group of Baheliyas. Officials say that gathering evidence to charge poachers and pursue them through the courts is very difficult. But last spring, authorities had a rare success when they arrested Mintar Singh, a member of the Baheliya clan, who was accused not only poaching tigers in Panna between 2004-2006, but also of killing rare Gir lions in the state of Gujarat in 2007. He is currently awaiting trial.

The authorities have had other successes. In 2007, police in the state of Uttar Pradesh, which neighbours Madhya Pradesh, carried out a raid on the home of Shabbir Hasan Qureshi, believed to be one of the most important middlemen between the poachers and buyers in China and Tibet. He is in jail, waiting to come to trial. "Qureshi was probably handling a quarter of all the trade in India and many tigers have been through his hands this year alone," Belinda Wright, executive director of the Wildlife Protection Society of India, said at the time. "Taking him out is huge – a major breakthrough."

While some of the main suspected poachers prove elusive, campaigners and officials know the whereabouts of many of those alleged of involvement. Indeed, outside of Panna, close to a village called Janwar, members of the Baheliya tribe are camped out by the side of the road. Their shacks are made from plastic and branches and they have with them just a few basic belongings. The tribe members tell me that in recent months they have been constantly harried by forest department officials and that they have stopped any sort of hunting in the forests. "We have left every piece of trapping equipment," says a man who gives his name as Garis. A woman displaying a box of small glass bottles, adds: "We survive by selling scent and medicine. But now we're not allowed to go into the jungle to get the herbs."

The clan members deny they have ever been involved in killing tigers and when asked why they think all the tigers have disappeared, they say they have no idea. Likewise, when asked about the whereabouts of some of the Baheliyas accused of poaching many of Panna's tigers – men with monikers such as English, Rakitlal, Plate, Gilet and Lalarsi – they say they do not know. "Our future should be sorted by the government," says Garis. "If land is not given to us, how can we live? We used to roam, now we have left everything behind."

Raghu Chundawat has devoted much of his life to trying to save India's tigers and yet today he considers himself an outcast, Rassled by the authorities and chased in the courts. He is the whistleblower that nobody wanted to believe, and despite the fact that his claims were proven true, he does not believe the system has changed. "It is the system that has failed the tigers in Panna," he says over tea at his property, close to the Ken River. "This applies to the lowest member of staff to the highest and all the people on committees. We know that up to 40 tigers have died but still there is no accountability."

Chundawat began studying tigers in 1996 and by use of photo-trapping, he and his team of independent researchers, funded by NGOs, were able to show that in 2002 there were 35 tigers in the park. It was at that point that they began to notice an increase in dead prey species, caught in snares. One tiger went missing and then a second was found dead, also killed by a snare. There was evidence of more poaching. "We reported it to the authorities. They were very aggressive. It was the typical 'shoot the messenger' thing," he says. "They targeted us, restricted our movements."

Eventually, Chundawat went to the media, which led to the authorities charging him with various wild-sounding allegations and banning him from the park. Arun Singh, a reporter with the local newspaper, Nav Bharat Times, used information from the whistleblower in several stories that led to international headlines, and was able to confirm the details from people living inside the reserve. "I had a good relationship with all the villagers inside the park. They told me. They gave me evidence of poaching," says Singh, sitting in the simple second-floor room that serves as his bureau, close to the centre of Panna.

Yet the local authorities continued to dismiss claims that the tigers were threatened. In 2005, the then park director held a press conference at which he said there were 35 tigers in the park. "We asked to see the evidence. They manipulated the results," alleges Singh.

While the state authorities installed new management in the aftermath of Panna's debacle, those who were in charge while the tigers were eradicated have suffered no punishment or rebuke. Indeed, the then park director was promoted to a higher position within the state department of wildlife. As is often the case in India, while there may be no shortage of public money sloshing around, there is no accountability.

But with the elision of such accountability, with such strident oversight from the very highest levels of India's political establishment, how will the tigers survive? "The biggest threat to tigers is a lack of good governance. The first thing to do is reform all systems of governance," says Valmit Thakar, one of India's most celebrated conservationists and a member of a panel that advises the prime minister. "Disband the forest service and create a focused, specialised service that can deliver to the tiger and wildlife." The price of not doing so, he says, will be the loss of the tiger and the admission that "we didn't have the ability to save the most charismatic species that nature created for this planet".

But how long can the tiger wait for these reforms? Many experts already believe it is too late to save a genetically viable population of wild tigers across India, outside of just two or three heavily managed reserves. In public they force themselves to sound optimistic, but privately they hold grave doubts.

Yet even now, the situation at Panna shows there is still hope for this most threatened of wild creatures. Back in the four-wheel drive, after pointing out the potential tiger lairs close to the waterfall, Sreenivasa Murthy, the man drafted in last year after one of the most shameful chapters in India's faltering narrative to save the tiger, takes a call on his mobile phone.