Zembla, Zenda, Xanadu: All our dream-worlds may come true.

Fairy lands are fearsome too.

As I wander far from view Read, and bring me home to you.

This is Salman Rushdie’s dedication to his son Zafar inside the cover of Haroun and the Sea of Stories, the first writing to emerge after the fatwa that followed publication of The Satanic Verses in 1988.

Rushdie was rarely able to see Zafar - who was nine when his father had to disappear - while he was writing the book. Instead he phoned his son every day and sent him Haroun chapter by chapter. Zafar would send the author of Midnight’s Children (the Booker of Bookers) off to rewrite, saying of his latest effort: “It doesn’t jump up enough.”

“He was my first reader of the whole manuscript too. I had promised him that I would write a book for him, and after everything that had happened it was an important promise to keep. It was a way of us staying close.”

Now Zafar is reading Spanish and Italian at university, his father has his life back and Haroun, nine years after publication, has blossomed into a new illustrated edition. When Rushdie sat down in a series of temporary hideouts to write about a real father-son relationship, with an audience of one in mind, it was the tactic of a writer as well as an unwillingly absent father.

“If you really try to capture the imagination of one child, by doing so you get everyone else. The interesting lesson for me about writing Haroun was that it was specifically for one person and acquired a broad appeal. It struck me later that many of the children’s books that I most admired - Alice, Winnie-the-Pooh, The Wind in the Willows - were also written for one child. If you try to write something with a broad appeal, you can’t.”

In the book Haroun is the son of Rashid, a storyteller who has lost the gift of the gab. The boy’s quest to restore his father’s silver tongue leads him into the territories of Gup (perpetual sunshine, chatter and loud clashing egos) and Chap (perpetual darkness, silence and despair, the source of the poison that is polluting the Sea of Stories). The master villain of Chap is Khattam-Shud (his name is Hindi for the dreaded words “end of story”). The antidote to the poison is bloodymindedness: the citizens of Chap, deprived of words, develop a sophisticated language of gesture; the storyteller’s son wins the day but has to overcome personal demons first.

“I wanted Haroun to have something of my own son’s directness and determination,” Rushdie says. Haroun’s inability to concentrate on anything for more than 11 minutes at a time (crucial to the plot) is a family joke, as are the agonising child-friendly puns (the Plentimaw fish in the sea, the characters Iff and Butt and the references to the Beatles’ song “I Am the Walrus”). There is a running joke about bureaucracy (and obstructive, know-all adults) which involves a P2C2E (Process Too Complicated To Explain). The word play, swift scene changes and regular peaks of excitement help to make Haroun an ideal read-aloud book which has appeal for older children and which reflects the intimacy of the situation in which it was written.

Now the new edition and last year’s National Theatre production have helped to confirm its contemporary classic status. Rushdie is delighted with the colour illustrations by Paul Birkbeck, who first illustrated Haroun for Art Malik’s Jackanory reading: the wedding-cake palaces in the garrulous City of Gup, the hellish innards of the ship that manufactures the pollutants and the crowds hanging on the storyteller’s words.

“I love the intricacy of the pictures, you can look at them for a very long time. He’s got a wonderful grasp of the particular tone of voice of the book and he’ s got the characters very well - it’s important that Haroun is the right little boy.”

Rushdie grew up surrounded by his own private sea of stories in post-partition Bombay, the son of a primary school teacher mother and a father with property interests. “It was noisy: India is a noisy country anyway and our house was especially so. I had three sisters and there was a lot of competition for air time. If you wanted to be heard you couldn’t hang back.” Like Haroun (and Zafar, and Rushdie’s younger son Milan, now two and a Pooh fan), Salman had a father who was the Ocean of Notions. The fable quality of Haroun stems from the traditional Hindi tales his father told him. Otherwise, like other middle-class Indian children, he was brought up on Arthur Ransome and Frank Richards’s Billy Bunter.

While his father did the bedtime stories, his mother was more likely to launch into family sagas. “If you wanted the scandal or the dope on people, so-and-so’s distant cousin or whoever, she was the person to ask. She had an encyclopedic knowledge of our family tree and everyone else’s. Later on she realised that some of it was ending up in my books and she became more circumspect.”

Growing up near the centre of the Indian film industry, he rarely missed Saturday morning matinees. “We were movie brats - the pre-video generation.” Besides the glitzy, deeply romantic Bollywood epics, he also remembers seeing The Wizard of Oz, which led to one of his first short stories, “Over the Rainbow”, and to a book of film criticism. Haroun has a film’s pace and wide horizons, and echoes of the MGM Oz in that everything has its parallels in the fable world. Rashid’s decline begins when his wife Soraya stops singing; the ugly princess of Gup, Batcheet, can’t sing but does, non-stop.

The British Empire was being dismantled throughout Rushdie’s childhood but the English-language independent school system used by the Indian middle classes stayed in place. He went to Walsingham School, a church foundation kindergarten, followed by an Anglo-Scottish Education Society establishment. On the minus side was the ordeal of “good old English PT, with parallel bars and rings and a very nasty PT teacher”; on the plus side the “vivid teaching style” of his English and Latin teacher, Alan Glynne Howell.

While the British-built schools were still running as normal, the textbooks could be rewritten over the summer. “Suddenly the villains that we knew from the imperialist history textbooks were the heroes. It was an early discovery about how you can’t take history for granted as objective truth.” In Haroun, the tales in the Sea of Stories literally become twisted until the boy stops the pollution at the source.

Rushdie left India for England and Rugby School at 14 and found himself plunged emotionally from Gup into Chap. “The England that I felt familiar with was an idealised England from books and it was a bigger adjustment than I expected. The winter of 1961 was very cold and I wasn’t used to bad weather.

“I felt more alien than I had expected to - I’d thought I’d slot right in. Public schools are a harsh environment anyway, and I was foreign, and clever, and bad at games - two out of three might have been all right, three out of three meant you had no chance of fitting in.”

There were some consolations: the history teacher who gave him The Lord of the Rings to read in his O-level term (“I nearly failed but I became a Tolkien fan”) and his father taking him to Spurs matches. “I wasn’t happy most of the time but I was well taught, and I’m pleased to say that Zafar remembers his schooldays as a happy time.”

The world knew the first edition of Haroun as dispatches from an author underground; this time round it’s simply a good story. Rushdie is looking forward to meeting his new readers as it’s now much easier for him to attend book events. He can also go and watch Spurs, which is still his team, “although I don’t know how much of a pleasure that is”, he says.

Haroun and the Sea of Stories ispublished by Viking pound;14.99