"At the stroke of the midnight hour, when the world sleeps, India will awake to life and freedom." —Jawaharlal Nehru, first prime minister of India
Salman Rushdie's celebrated novel Midnight's Children, published in 1981, is an excellent example of a postmodern, postcolonial, and magical realist novel. Rushdie uses elements of history, myth, fantasy, and the sprawling nineteenth-century novels of Dickens to construct a book that deals with individual Indian characters set against the backdrop of 1947, when India gained its independence from England and was partitioned into the Union of India and the Dominion of Pakistan. The partition resulted in mass migrations and much violence between the country's many ethnic and religious groups, primarily Hindus and Muslims. Rushdie himself was born into a Muslim Indian family.
The eminent literary scholar and critic M. H. Abrams defines magical realism as "a sharply etched realism in representing ordinary events and descriptive details together with fantastic and dreamlike elements, as well as with materials derived from myth and fairy tales." In Midnight's Children, the protagonist, Saleem Sinai, is born at midnight on August, 15, 1947, exactly at the same time independent India is born. He and all the other children born then, who give the books its title, have magical powers; Saleem is telepathic and, later, develops the ability to "smell" emotions. Rushdie uses the elements of magical realism to give the book a mythic or fantastic feel, as well as to mitigate what can sometimes be dark subject matter and to critically engage with Western/British depictions of India in literature and culture.
You might want to look at Rushdie's website, as well as a book on postcolonial studies titled The Empire Writes Back, and a history of partition, Indian Summer.