'The Incarnations' reads as China's Midnight's Children. An utterly remarkable novel, it is certainly a very different book from Rushdie's, but just as important in its historical and cultural sweep. In this third novel, Susan Barker, born to a Chinese Malaysian mother and an English father, adapts reincarnation to explore a thousand years of Chinese history.

Beijing taxi driver Wang is the sixth incarnation of Sorceress Wu. En route to becoming Wang, Wu morphs into: a Jurchen boy enslaved by Ghengis Khan's Mongol hordes; Swallow, a Ming dynasty concubine; Ah Qin, an Opium War waif and, finally, a reluctant Maoist firebrand at The Anti-Capitalist School for Revolutionary Girls.

The stories of Wang's previous incarnations are transmitted to him via anonymous letters which exacerbate an already fragile mental state. Wang, the son of a powerful official, was not destined to become a taxi driver. But a mental breakdown, brought on by a childhood of domestic violence and his mother's disappearance, ends his university studies.

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Committed to a psychiatric hospital, Wang mingles with patients who reflect the unresolved post-trauma of recent Chinese history. Wei Hong was sacked as a teacher when he suddenly reverted to Cultural Revolution norms. Wei made his class of seven-year-olds write "Thought Reports" before leading them to beat up an innocent little girl and smear her with black ink. Another patient flashes back to Tiananmen Square: "They are cracking down again! They are shooting at us! Get down or be killed!"

Wang's former lives are even more desperate than his present. Concubine Swallow's tale veers from Pythonesque to horrific. The sadistic Emperor Jiajing imbibes a virility enhancing brew of "elk horn and deer penis" while eunuch scribes keep a "Ledger of Bowel Movements and Menstrual Cycle of the Concubines". The emperor prepares for sex by "smearing his erection with verdigris and snake dung and snorting powdery aphrodisiacs". He is, of course, "the only man in the Forbidden City with his genitalia intact". Total power permits total gratification, however unhinged. Jiajing, nicknamed Emperor of Knives, likes to carve up his concubines.

Barker's storytelling is lively and addictive despite the bleakness of her histories. She has an eye for the absurd and darkly comic. After the Red Guards change Beijing's traffic signals so "revolutionary red" means "go", the hapless victims of the inevitable accidents are persecuted for "clinging to Old Ways of Thinking".

Barker's present-day Beijing is less violent and irrational, but grimy, polluted and soulless. It is a city of building sites strewn with "rotten cabbage leaves" and "polystyrene take-away containers". The excesses of Maoism have given way to sterile materialism and alienation: "The rice seller hands Wang his change without looking up from the old Bruce Lee movie on the laptop perched above his till."

Ever lyrical, Barker imagines Beijing's poisoned air as "the curse of the million-year-old fossils... protesting at being dug out of their resting places". The novel's mysterious letter writer, aka The Watcher, is finally revealed with a satisfying and redeeming twist. The Watcher is more than a person and an incarnation. She is something inescapable: "History is coming for you... History breathes its foggy thousand-year-old breath down your neck."