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Further works, 1990s–2000s

In 1990, Rushdie reviewed Thomas Pynchon 's Vineland in The New York Times, and offered some droll musings on the author's reclusiveness: "So he wants a private life and no photographs and nobody to know his home address. I can dig it, I can relate to that (but, like, he should try it when it's compulsory instead of a free-choice option)." Rushdie recalls: "I was able to meet the famously invisible man. I had dinner with him at Sonny Mehta 's apartment in Manhattan and found him very satisfyingly Pynchonesque. At the end of dinner I thought, well, now we’re friends, and maybe we’ll see each other from time to time. He never called again."

Rushdie has published many short stories, including those collected in East, West (1994). His 1995 novel The Moor's Last Sigh, a family saga spanning some 100 years of India's history, won the Whitbread Award. The Ground Beneath Her Feet (1999) is a riff on the myth of Orpheus and Eurydice, casting Orpheus and Eurydice as rock stars. The book features many original song lyrics; one was the basis for the U2 song "The Ground Beneath Her Feet". Rushdie is credited as the lyricist.

Following Fury (2001), set mainly in New York and avoiding the previous sprawling narrative style that spans generations, periods and places, Rushdie's novel Shalimar the Clown (2005), a story about love and betrayal set in Kashmir and Los Angeles, was hailed as a return to form by a number of critics.

In his 2002 non-fiction collection Step Across This Line, he professes his admiration for Italo Calvino and Pynchon, among others. His early influences included Jorge Luis Borges, Mikhail Bulgakov, Lewis Carroll and Günter Grass. When asked who his favorite novelist is, he says: "There are days when it’s Kafka, in whose world we all live; others when it’s Dickens, for the sheer fecundity of his imagination and the beauty of his prose. But it’s probably Joyce on more days than anyone else."

2008 saw the publication of The Enchantress of Florence, one of Rushdie's most challenging works that focuses on the past. It tells the story of a European's visit to Akbar 's court, and his revelation that he is a lost relative of the Mughal emperor. The novel was praised by Ursula Le Guin in a review in The Guardian as a "sumptuous mixture of history with fable". Luka and the Fire of Life, a sequel to Haroun and the Sea of Stories, was published in November 2010 to critical acclaim. Earlier that year, he announced that he was writing his memoir, Joseph Anton: A Memoir, which was published in September 2012.

In 2012, Rushdie became one of the first major authors to embrace Booktrack (a company that synchronises ebooks with customised soundtracks), when he published his short story " In the South " on the platform.