I think that many consider Rushdie's work to be an example of historical fiction. Being true to form about his own capacity as an artist, Rushdie might hold some views on the subject. If one considers historical fiction to be something that has to be more on the side of the "history" as opposed to the "fiction," then I think that there are some The most elemental is that we, as the reader, understand what happens in the work through the eyes of Saleem. We take what he gives us about the time period and this becomes a source of where the historical fiction content has to be questioned. Saleem is not the most reliable of narrators. For those who are driven by historical fiction reflecting historical reality, this becomes a challenge. For Rushdie, though, it is a source of liberation because the unreliable narrator allows him to explore the freedom by which he is so animated in both his beliefs and in the message of the work, itself. Consider his own words on this subject:
Many readers wanted it [the book] to be the history, even the guidebook, which it was never meant to be; others resented it for its incompleteness, pointing out, among other things, that I had failed to mention the glories of Urdu poetry, of the plight of the Harijans, or untouchables, or what some people think of as the new imperialism of the Hindi language in South India. These variously disappointed readers were judging the book not as a novel, but as some sort of inadequate reference book or encyclopaedia... History is always ambiguous. Facts are hard to establish, and capable of being given many meanings. Reality is built on our prejudices, misconceptions and ignorance as well as on our perceptiveness and knowledge. The reading of Saleem's unreliable narration might be, I believed a useful analogy for the way in which we all, every day, attempt to 'read' the world.
In the end, I think that Rushdie's work, like Rushdie, himself forces the reader to assess reality beyond categorical distinctions, and engage in a reflective exercise about ourselves and our experiences that forces us to question what defines genre, literature, and historical reality.