Uncapped seam bowler Jamie Porter is also included.
But it is Rashid’s return, after winning the last of his 10 Test caps in Chennai more than 18 months ago, which will dominate the headlines.
It comes on the back of his much-improved white-ball international form of late and follows his personal guarantee to England that he will re-commit long-term to Test cricket.
Smith said: “Adil Rashid returns to the England Test squad.
“Before the selection meeting, Adil had confirmed his availability to play Test cricket for England for whole of this summer and the upcoming winter tours to Sri Lanka and West Indies.”
He spelled out that Rashid’s current arrangement can only continue on the understanding he returns to domestic red-ball cricket next summer.
“Following his earlier decision in February, 2018, Adil has a white-ball only contract to play for Yorkshire this summer,” said Smith.
“That arrangement is unchanged by his selection for England.
“However, Adil fully understands that if he wishes to be eligible for Test cricket in the 2019 season, he must have a county contract to play four-day cricket.
“Moving forward, England Test players must be committed to the County Championship.
“Clearly, the one-off circumstances around Adil’s return to the Test squad are unusual.
“However, the selection panel was unanimous in believing that Adil should be selected in England’s squad.”
Rashid’s case was underlined when he bowled India captain Virat Kohli with a memorable leg-break as England clinched the one-day international series on his home ground at Headingley last week.
England squad: JE Root (capt), MM Ali, JM Anderson, JM Bairstow (wkt), SCJ Broad, JC Buttler, AN Cook, SM Curran, KK Jennings, DJ Malan, JA Porter, AU Rashid, BA Stokes.