Ransom, By David Malouf

David Malouf's book is born of war. He was first gripped by the stories of the eighth-century BC Iliad as a Brisbane schoolboy in 1943, living among sandbagged buildings and watching constant American troop movements north to the battles of the Pacific. He began this novel 60 years later, drawing on that ancient tale of war just a year or so after the destruction of the World Trade Centre.

It is not surprising that his take on extreme and seemingly inexorable violence should be told from the sidelines and should speculate on the back-story of the Trojan war: on bruised humanity, of small glances and fancies, hopes and fortunes dashed, rather than the clash of weapons and heroic egos. But the themes of this apparently simple, yet immensely moving, modern novel are still vast: loss, forgiveness, love and redemption.

Malouf's account is centred on Priam, aged King of Troy, going to his enemy, Achilles, to ask for the body of his son, Hector. Achilles, maddened by Hector's fatal assault on his closest friend, Patroclus, has gone against the code of war in violating Hector's body and refusing it burial.

Priam takes a ransom to exchange for the corpse but reveals to his peasant carter that his own name means "ransom". As a child, then called Podarces, he explains, he escaped Troy in a rabble of dirty, terrified children after the slaughter of his father, the king, and his brothers, and was ransomed by his sister in lieu of a gift promised her by Heracles who then re-named him.

Now he takes a bounty of gold to Achilles but we see it is Priam's dignity and honour, his life, that is yet again a ransom. While Achilles is dragging Hector's body behind a burnished chariot drawn by fine horses, Priam, stripped of the symbols and comforts of kingship, sets out towards him on a wagon drawn by two mules: one aptly called Beauty and one, with "no special charm", called Shock.

Like the king, the carter has his name changed by circumstance and becomes, unwillingly - for who knows how the gods might react to the imposition of greatness? - Idaeus, the traditional royal herald.

On the journey to the uncertainties of Achilles' camp they are joined briefly by the garrulous god Hermes, a timelessly irritating fellow-passenger, but through his driver Priam learns to be ordinary and even find momentary happiness: to walk barefoot in a river, to eat griddle cakes, to share the grief of losing sons, and to exchange tales.

For Ransom is all about the creation of identity and bonds through storytelling. Somax, who returns home rich in stories, measures his subsequent longevity by the fact that no one believes him any more.

Lyrical, witty, gentle, this is above all a story of transformation. Priam departs as a king but returns a man; Somax gains stature as guide and friend; Hector's body is brought home miraculously free of corruption. And the Troy we first encounter as a dusty near-eastern settlement from a National Geographic magazine – "dovecotes, cisterns, yards where black goats are penned... and houses of whitewashed mud-brick" – looks different when Priam finally returns with his son: "the hills towards Troy are just beginning to develop shadows on their sides; their crests are touched with gold".

Elizabeth Speller's novel, 'The Return of Captain John Emmett' will be published by Virago next year