Everywhere in India, the same volume seems to poke out of book sellers' stands, between Agatha Christie and Reader's Digest: V.S. Naipaul's India: A Million Mutinies Now. Wedged in a corner seat of a rattling train for a 27-hour journey, you can read of Naipaul's "mutinies": of the grandson of the Brahman priest who became a nuclear scientist, of the untouchable Dalit turned poet, of a generation turning away from its predecessors' acceptance of poverty and deprivation.

Published in 1990, the book was Naipaul's personal mutiny, an optimistic uprising against the horror of India he had written about some 25 years before, when, as a Trinidad-born writer of Indian descent, he had first visited his ancestral land and found it horribly lacking.

Now Naipaul has returned to India with Half A Life, his 26th book but his first novel for seven years. He has also returned to mutinies, kicking off with the story of Willy Chandran's father, a kind of accidental guru who rebels against his Brahman family, with dubious results. It is, as Naipaul chuckles, a more satirical idea of a mutiny.

"The man is moved by Gandhi to do something, to go against his caste instincts and marry someone very low, and it takes him by surprise, what happens; he's rather defeated. So it was half a joke, you know, half a joke. It's not strictly a mutiny; it's a mutiny that's gone wrong."

There are other ways in which the book is a rebellion, not least that Naipaul wrote it at all. It was only a few years ago that he declared the novel as a form to be "finished", and yet here is one that adopts a classic, almost 19th-century structure, as Willy moves fitfully from India to London, into marriage and on to Portuguese Africa. Naipaul is unrepentant.

"There are different forms for different materials: every material has to have its own form . . . If you are writing about people who live in a kind of half world, who live a kind of half life, it's very hard to write non-fiction about that. That is something that can only be done in a work of the imagination."

The Indian setting in the first part of Half A Life is also a bit of a surprise, as Naipaul, who is regarded as a crucial if controversial post-colonial voice, had never set a novel on the subcontinent. His early novels - including A House For Mr Biswas, which is regarded as one of his finest - are set in a fictionalised version of Trinidad, while others, including the Booker-winning In A Free State, take Africa as a base. So why did Naipaul, in his 70th year, finally feel he was ready to take on his ancestral homeland as a subject in his fiction?

"I had the material in my head, and so I began it in that way, with that old material," he says. "But if I had attempted 25 years ago to use that material, I wouldn't have been able to use it. I wouldn't have known enough. But since then, \the book became larger, it extended to other countries, so I was able to use the material at last. A writer's head is full of these impressions that he's not yet used."

If Naipaul is a contradictory figure, it hardly comes as a surprise. His career is weighed down with critical acclaim on one hand and public controversy on the other.

There is the 1971 Booker Prize, the 1993 David Cohen British Literature Prize for lifetime achievement, the 1990 knighthood, which makes him Sir Vidia - V.S. stands for Vidiadhar Surajprasad - and countless others. Indeed, as the cover of the new novel points out, acerbically, "he has won every major literary award bar the Nobel".

Then there are several literary spats, the most famous with Paul Theroux, the travel writer. A former disciple and good friend of Naipaul, Theroux turned against him with the publication of Sir Vidia's Shadow, in 1998, a vividly compelling hatchet job.

Naipaul maintains a steely silence about Theroux, but there are others about whom he is not so reticent. Most recently, in an interview with the Literary Review, he alleged that E.M. Forster "has his own purposes in India. He is a homosexual", that Keynes "exploited people in the university: he sodomised them", that he couldn't read James Joyce because he couldn't understand the work of a blind writer and that Dickens "died from self-parody".

But he limits himself to a withering dismissal of Penguin, his former publisher. Having bought back the rights to his earlier books, he is now with Picador, which is reissuing 17 works.

Bringing up the forthcoming Merchant Ivory production of one of his earliest books, The Mystic Masseur, also brings forth the legendary Naipaul ire. "A mistake, a great mistake."

Its director is Ismail Merchant, who produced such films as A Room With A View and The Remains Of The Day. Naipaul has reportedly turned down an offer from Francis Ford Coppola in the past.

Of more literary interest is his assertion that Willy Chandran, as a writer, is based not on his own writing career but on that of "a particular modern writer. I had somebody in mind". He will not be drawn on whom, perhaps understandably, as the portrait is one of an author who borrows his fiction from scenes in old films.

Yet if this depiction of a writer is not about Naipaul himself, it is a rarity, because, as the author readily admits, writing about writers tends to be an autobiographical act. The Mystic Masseur, he realises now, was "wish fulfilment", while The Enigma Of Arrival has "an autobiographical crust".

In Half A Life, Naipaul can be spied in the several figures who are observant and wistful outsiders, even when they seem to be fully integrated into the society they inhabit. "I think it probably reflects my own position. But, thank God, I didn't feel I was writing about myself, because one would have become self-indulgent. I wasn't aware, but I think one's material always reflects aspects of one's life, one's personality."

Indeed, Naipaul has been accused of incorporating his life into his analysis of the post-colonial world, as well as of stereotyping and of a profound pessimism about the possibility of post-colonial civilisation. Naipaul believes that place has shaped him completely. "One is just exploring little bits of it all the time."

He acknowledges that the writer's role as observer is not a neutral one. "The writer observes and would be scrupulously honest, but inevitably there is a position where the writer stands. He probably is intelligent and has a larger world view than many of the people he's writing about. He probably believes in civilisation and the people he's writing about don't, or don't even have an idea of civilisation."

For all his self-assuredness, and his occasional pomposity, there is a curious uncertainty to Naipaul. He constantly queries - "Do you know?" "Do you think so?" - as he makes his assertions, asking anxiously at one point: "Can one talk like this? Is it too self-regarding?"

His next project is a book of the imagination, he says. "I'm feeling my way from picture to picture, and if I get a picture every month, I'm very happy."

When it comes to Half A Life, he claims to be astonished at what critics have thrown up. "The first time it was told to me the book was very sexual, I was very 'Hello? Hello?' and then, of course, it's so obvious. It's amazing that I didn't realise . . . I was thinking about purely technical problems and these other things were there."

Once they are pointed out to him, he bows graciously to the reader's interpretation. "I am not the final judge of what I have written. The reader does that. The writer starts with a few ambitions but then all kinds of other things come out - subterranean motives, impressions - so the finished work is quite different from the one the writer had in mind.

"If a book has no element of surprise, whether it's a fiction book or non-fiction, it's a dead book. All books, to be living, must have that element of surprise, of things taking wing."

Half A Life is published by Picador, £15.99 in UK