There is no way of knowing how many people developed Aids as the result of blood selling. Yan estimates that 95 per cent of all 25- to 40-year-olds in the northeast region of Henan sold their blood, representing hundreds of thousands of people. Blood selling took place in other provinces too. Initially, when villagers started falling ill, no one knew what was wrong - they called it 'fever sickness', says Yan. It took a couple of years before word spread that it was Aids.

'People died quietly at home because they were afraid it would affect their families' chances of finding marriage partners,' the 48-year-old writer says.

It was a strong sense of historical responsibility and a love for his home that drove Yan, a Henan native, to write the haunting tale about an Aids-stricken village on Henan's dry plains. The novel is narrated by deceased 12-year-old Ding Qiang, son of the village's leading bloodhead, Ding Hui, who was poisoned by villagers in revenge for his father's activities. The murdered boy's grandfather, Ding Shuiyang, the local school bell-ringer, is furious with his profiteering son and demands he kow-tow to each family in the village for forgiveness. Ding Hui refuses and eventually the bell-ringer beats his son to death. By framing the novel with two acts of son-killing, Yan wanted to show how the disease had ravaged human relationships and lives in China.

The village in the novel is based on one affected village in northeast Henan, which Yan visited seven times to research his book, posing as a Chinese-American doctor's assistant. The village, which Yan declines to name, had a population of about 800 people, and about 200 of them were infected.

'The door of every household had white funerary couplets pasted outside, usually more than one on each,' Yan recalls. 'Some were layered three or four deep,' he says.

Yan drew much of his information from bloodheads, who confided in him, believing he was the doctor's assistant. He discovered that hygiene levels were desperately low. Some used expandable plastic bags, normally used to store vinegar, to store blood - but they were not properly sterilised. 'Some were so ignorant about hygiene that they washed the bags in the village pond,' says Yan. 'It often turned red, and the mosquitoes and frogs those years were huge.' Many details about how the bloodheads operated were simply too grisly to include in the novel, says Yan.

Published in January in Hong Kong and Shanghai, and initially distributed nationwide, Yan's novel has been welcomed by Aids activists all over China. 'It totally matched what I know about Aids, even down to the individual people he described,' says activist Zeng Jinyan, programme co-ordinator at Loving Source, a Beijing-based grass-roots non-governmental organisation which focuses on Aids-related education, fundraising and outreach activities. 'I don't even think of it as 'literature' because it's so realistic.'

The practice of blood selling was conceived by the Chinese government as a way of tackling blood supply shortages in the 1990s. Facing the prejudice against giving blood, Henan's provincial authorities - like other provincial authorities on the mainland - called on farmers to donate blood in return for money. Blood-collection clinics, initially run by government-owned hospitals, started paying people for their blood, but exercising only limited health precautions: happily, 'they would boil their needles', says Yan.

Following the discovery of HIV in the blood supply, some clinics closed. Others, however, continued to operate - with, or without the knowledge of the provincial governments - and bloodheads sprang up to capitalise on a business which had gone underground. 'It turned into a black market,' Yan says.

Today, the Health Ministry says China has 650,000 Aids sufferers. Some doubt that figure, however, estimating there could be as many as that number alone just in Henan province - the epicentre of blood-selling activities and infections.

'The government says it will contain the spread of Aids to 1.5 million people by 2010,' says one activist. 'But I think we already have that many.' (The UN has warned that by 2010 China could have up to 10 million Aids sufferers).

According to the Health Ministry, blood-sellers had been punished, although it would not elaborate. Human rights organisations, however, say no officials have been punished for the disaster. According to a 2003 Human Rights Watch report which has not been contradicted to date, the Chinese government is yet to hold Henan officials accountable. 'No official has been jailed for the Henan scandal,' said the report. 'Worse, some of the officials who profited from the blood scandal and who covered up Aids in Henan, have been promoted.'

The authorities have taken action to quash Yan's moving tale, with his publisher, the Shanghai Literature and Arts Publishing House, told to halt distribution. Now, the only place to buy the book is on the black market - or in Hong Kong. Yan is under surveillance and media outlets in Henan have been forbidden from publicising the novel.

Yan has an established reputation on the mainland as an author, having previously published two controversial novels, Serve the People and Shouhuo. Serve the People is a story of an illicit affair and contains barely veiled attacks on communism; while Shouhuo is about handicapped villagers seeking Lenin's corpse to boost tourism - it won the mainland's prestigious Mao Dun literary prize. Until two years ago, Yan, a thoughtful man from a Henan farming family, was part of the People's Liberation Army (PLA). He joined the PLA's Second Artillery Unit in 1978 to escape grinding poverty, and spent many of his years there as an army writer. Growing up in Henan during the famine that followed the Great Leap Forward, Yan experienced extreme hardships and is disgusted that Chinese fiction writers have avoided the topic.

'Henan lost more than any other province during the Great Leap Forward,' says Yan. 'We lived in the mountains so we did a little better than many. We could dig things up and eat them. Most people died down on the plains. And that is where Aids is hitting. Henan is the epicentre once again. This is my generation and my responsibility. I'm a Henan'er, and I can do it better than anyone else.'

To this day blood donation is unpopular on the mainland. When forced - some workplaces are mandated to donate - rich city dwellers sometimes pay poor, untraceable migrant workers to go in their place, increasing the risk of contaminated blood entering the system. And while the government says it tests blood for HIV, in practice that rarely happens, raising serious concerns that China's blood supply is unsafe. At least 41 people have been acknowledged to have contracted HIV through transfusions in recent years, but the number is likely to be much higher.

In the village Yan visited, the biggest bloodhead still hasn't been brought to justice. Instead, he has become the head of the village, according to activists.