Now that opponents of the military regimes believe that tourism can help Burma, there has never been a better time to visit this country of bewildering diversity and astounding beauty.

Mandalay is one of the most evocative place names on the entire atlas – Rudyard Kipling forever linked Burma’s second city with images of sticky tropical heat, Buddhist temples and thwarted love.

And the road to Mandalay – where the flying fishes play – isn’t a road at all, but the Irrawaddy River. At daybreak, it’s a vast sweep of pearl marking out the western edge of the city. Through the morning haze, there’s the muted noise of traffic, mist rising from dark green foliage and the gleaming golden roofs of pagodas and monasteries.

On the streets, in the morning rush hour, traditional dress is the norm: both men and women wear longyis – the Burmese sarong. Schoolchildren carry lunch in tiffin boxes. Girls with cheeks smeared with thanaka (sun block made from ground tree bark) balance two to a bicycle. Barefoot monks holding alms bowls share the streets with scooters, battered cars and cycle rickshaws. Street vendors cook mohingar, a spicy fish broth, over charcoal stoves for breakfast.

The heat, smells, street life and colours of Mandalay are intoxicating. But what’s especially striking to a visitor is the distinct flavour of the not-so-distant past. There are few tourists, no ATMs, International Direct Dial phones are rare and your mobile phone won’t roam here. You can’t pay for anything with a credit card and the only currency you’ll be able to exchange is the US dollar – and if your bills aren’t pristine, they won’t be accepted. Shopping means walking around with a big wad of 1,000-kyat notes.

The reasons for this, of course, are sad ones. The Union of Myanmar, to give it its official name, is ruled by the longest-lasting military dictatorship in the world. Economic sanctions have been in place against it for decades. For many years, the democratic opposition said it was unethical for travellers to come here, that they would lend moral and financial support to the regime in doing so.

Yet in the summer of 2011, Aung San Suu Kyi declared in the first of her Reith Lectures that she wanted foreign travellers to visit Burma. The daughter of a hero of Burmese independence and a Nobel laureate herself, Suu Kyi is the political conscience of her country. Her residence in Rangoon, where she spent nearly 15 years under house arrest, is pointed out in hushed tones. She is referred to in conversation simply as The Lady. No-one who has ever wanted to come to Burma needs more encouragement than hers. Her only caveat was that visitors should avoid the tourist establishments that have close ties with the military regime.

Despite its occasional prominence in the press, Burma remains largely unknown. Some 300,000 tourists visited in 2010; by comparison, about three-and-a-half million people a year pay to go on the London Eye. Coming here preserves that sense of a first trip overseas: the gasp of tropical air on the runway, and the palpable remoteness from home. Travelling through the country, you begin to glimpse the complex influences that have shaped it: Buddhism, the legacy of the British Empire, the ethnic diversity of the population, and the long imperial history of the Burmese themselves.

An hour outside Mandalay, a bumpy road ends at a ferry crossing over a tributary of the Irrawaddy River. The journey continues on the other side by horse drawn cart. The driver, Theinzaw, is 39. His horse is called Dolay – the Burmese nickname for Cristiano Ronaldo, the former Manchester United winger. English Premier League football is an obsession here.

Theinzaw guides Dolay down a narrow, muddy track. The heat is intense. The loudest sounds are made by birds and insects. There’s little to suggest that this place, Ava, was once one of Burma’s greatest royal capitals. From the 11th century until the British arrived in the middle of the 19th century, Burma was a major regional power with an empire of its own. At one stage it included present-day Bangladesh and Thailand. Though ruled by Burmese monarchs, the state was a patchwork of nationalities: ethnic Burmese, Mon, Shan, Chin, Kayin and many others.

The red-brick entrances to Ava still stand, and there’s an old watchtower in its centre. An earthquake in 1838 caused one side of the tower to drop by two metres. Standing on its wonky top, I can see other remnants of the royal city poking out of the trees – two monasteries, another gateway, two dilapidated bathing tanks – but the rest of the landscape’s taken up with trees, bamboo shacks, skinny cows and bullock carts.

The monastery to the northwest of the old city is made of solid teak and its weathered boards creak underfoot. The northern hall of the monastery has been turned into a classroom, with desks, posters and a blackboard. It’s lunchtime, and the children are outside swimming in the lake. The school’s sole teacher, U Nayakar, has taught here for 30 years, instructing the village children in maths, reading, Burmese, a little English, and Pali – the ancient religious language of Buddhist scripture.

In this poor country, free schools run by monks are most children’s only chance of an education. Burma is a deeply religious place where 90 per cent of people follow the Theravada school of Buddhism. Buddhist festivals punctuate laborious agricultural life. Monks in maroon or orange robes, and nuns in pink robes holding parasols, are a common sight. Just across the Irrawaddy from Ava, more than 2,000 Buddhist temples dot the hillsides of Sagaing, their gilded roofs dazzling through the trees. It is a place of prayer and scholarship. Low chanting is audible from an open window as nuns memorise their Pali scripture.

Yet it’s not all work. One Saturday night, I count 54 monks in a tea shop watching a match between Manchester United and Everton on TV. They sit in disconcerting silence until Manchester United score, whereupon they all applaud happily.

Buddhist monks are a political force, too. In 2007, thousands of them took part in demonstrations against the government, which we’re violently broken up.

Nearly 200 miles southeast of Mandalay lies Inle Lake. It’s an hour or so by plane across a landscape of tiny fields, huts and temples, a place without water or electricity where agriculture takes medieval forms. Long and tapering, Inle is a place of heart stopping beauty. Its limpid water, ringed by velvety green mountains, is full of floating villages and old temples. It’s also a good introduction to the dizzying ethnic mix of modern Burma. The country is a volatile blend of 135 ethnic groups, which the government has struggled to hold together since 1948.

Inle is in Shan State, the heartland of Burma, and home to the Shan people. But several different groups live around Inle: the Taungyo, the Pa-O and the Intha, whose houses are built on stilts on the lake itself.

The modest Intha houses in Pauk Par village are made from woven bamboo and thatched with wild grass. Daw Khin Phyoe Yee and her friends have gathered in her house to roll cheroots from tobacco grown in the mountains. It’s piecework for a local manufacturer. The rate is 1,500 kyat (£1.50) for 1,000 cheroots, about a day’s work. In another room, Phyoe Yee’s nephew is doing his English homework. His family summons him to practise on a native. ‘I am nine years,’ he manages, finally. Another man, so far silent, now has something important to communicate. It takes me a while to figure out that he’s saying: ‘Wayne Rooney!’

In the village of Inn Dein on the lake’s western edge, vendors start arriving for the weekly market before 6am. You reach it on a cigar-shaped wooden boat that putters up a long canal, past dragonflies and beds of water hyacinth. Pa-O and Taungyo villagers, recognisable by their headscarves, have walked down from the mountains in plimsolls, carrying baskets of tea leaves, pinewood kindling, lemons and avocados. The Intha have come by boat. They wear bamboo hats and sell fish and vegetables from the lake’s floating gardens. Intha fishermen are famous for their gymnastic style of rowing – they stand on one leg and paddle with the oar braced against the other. At the market, the different peoples of the lake meet and interact to their mutual benefit. However, life here has not always been this peaceful. The Pa-O were in armed revolt in 1991. They laid down their weapons, made peace with the government and now receive income from two guest lodges on the lake and tours to their villages.

My Pa-O guide – the first from her village to complete a university degree – speaks passionately about the opportunities that tourism gave her people and how she hopes to inspire the next generation to complete their schooling. Various other groups have since struck deals like the Pa-O’s. Elsewhere peace has been elusive: some central parts of Shan State are not under full government control and are closed to outside visitors.

During the months that I had been planning to visit Burma, political activity in the country seemed to accelerate, and much of what I read was out of date or inaccurate by the time I arrived. My laptop wasn’t impounded at the airport and I was able to rent a mobile phone and SIM card – although receiving calls from abroad proved almost impossible. And the official exchange rate and the black market rate appeared to have converged.

I never once saw a soldier or felt unsafe – but, of course, that’s the experience of most foreign visitors to Burma, and perhaps not the most accurate reflection of reality for the majority of people. Yet those whom I met seemed to speak with a new openness and a tentative hope about the future.

The civilian government that took office in the past year has released some political prisoners – although many still remain in jail – and cancelled the construction of a dam that would have disrupted life along the Irrawaddy in order to generate electricity for the Chinese. Aung San Suu Kyi, whose last period of house arrest came to an end in November 2010, was once a taboo figure, who was never mentioned in public. Now, she appears in the pages of the national newspapers. Wherever I went, I sensed a cautious optimism about these changes.

Bagan is the outstanding cultural monument of Burma. The city is only 80 miles from Mandalay, but the road is so bad that most visitors choose to fly or travel by boat – which is a day’s journeying down the Irrawaddy.

In July of 2011, The Lady herself visited Bagan to talk to the people and make a gesture of support for local artisans, whose future is intrinsically linked to continued tourism. While she was there, she dropped in to a local lacquer ware factory.

Lacquered goods have been made in Bagan since the 11th century, and 80 per cent of its population are involved in their manufacture. It’s a painstaking process, involving many stages, through which bamboo and resin are turned into delicate items of great strength and beauty: teapots, trays, cups, bowls and furniture.

‘She said she understood how important visitors are to us,’ says the proprietor of the factory as she shows me photographs of Aung San Suu Kyi’s visit. ‘She said she would encourage people to come.’

When I visited Bagan, farmers in its surrounding fields were beginning the peanut harvest – yanking up the plants by hand, bashing them with bamboo sticks to remove the peanuts and then winnowing them, one basket at a time, by standing on a tripod of bamboo poles and tipping them into the breeze.

In its heyday, between the 11th and the 13th centuries, Bagan was a rich and cosmopolitan place which had links with Sri Lanka, India, Thailand and China. Its wealth was invested in its religious buildings. Only a fraction of the original city remains, but in their age and scale, the ruins are reminiscent of the Angkorean temples of Cambodia.

Cycling along the dusty paths, you are quickly lost among the thousands of pagodas that cover the plains beside the Irrawaddy. They’re all of different sizes – from just a few metres in height to more than 60 metres. Many are shaped like bells, but others are more outlandish: Thammayangyi is a pyramid with stepped sides like a Mayan temple’s, while Ananda’s central golden stupa resembles a Fabergé egg. In the delicate 11th-century frescos within Loka Hteik Pann pagoda, the faces and postures of two dancers reflect the area’s historic links with India. And inside the old city walls lie the remnants of a single Hindu temple.

At sunset, the red bricks of the temples at Bagan turn a fiery pink against the backdrop of acacia and cassia trees. As the sun sinks below the horizon, the wind freshens slightly and bells on the golden umbrellas above the pagodas begin to tinkle.

It hardly needs saying that increased tourism will not solve Burma’s problems. Yet Aung San Suu Kyi’s desire for more visitors is one of many hopeful signs. This is a country of rare loveliness. It deserves to be better understood. And its emergence from the shadows is a cause for celebration.

The article 'A new dawn in Burma' was published in partnership with Lonely Planet Magazine.