Directed by Huo Jianqi and produced by Academy favorite Wong Kar-wai, the film depicts the legendary and epic seventh-century journey of a Buddhist monk from China to India.
Chinese actor Huang Xiaoming plays the monk who took 17 years to complete his journey.
The "Crook" star, who features in the movie along with other Indian actors like Sonu Sood and Ali Fazal, is ecstatic over the news.
"I was just going through Twitter when I read about the fact that it is the Chinese entry for Oscars. I was like 'wow'. This is what dreams are made of. The feeling is spectacular," Neha told PTI in an interview.
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China has selected the historical-epic as its contender in the best foreign-language category at the 89th Academy Awards, to be held next year. The film is a China -India co-production.
The 28-year-old actress says she had read about the story as a kid and when the opportunity came for the film, she immediately said yes to the project.
"When I saw the work of the director, I was like he really makes fantastic films and it was a team I wanted to work with. It was such a big opportunity because as a Bollywood actor such opportunities are rare."
Neha is now keen to do more international projects irrespective of the language-barrier as long as the movies offered to her are "interesting and good."
China has been nominated twice in the best foreign- language film category at the Oscars, but it has never won.