The 3.5-meter high statue was made by artisans of Shendiao Group Company in Zhejiang, said a spokesman from Zhejiang provincial religious affairs department.
A group of specialists from the State Administration of Religious Affairs in Beijing on Tuesday examined the statue and approved its export.
The statue will be placed in a memorial named after Xuanzang inside Nalanda Temple in Bihar, an ancient center of Buddhist learning.
Listed as one of the many activities for the Sino-Indian Year of Culture 2006, the memorial will be open to worshippers in November.
Xuanzang received a classical Confucian education before converting to Buddhism.
Troubled by discrepancies in the sacred texts, he left for India in 629 to study the religion at its source. He traveled by foot across Central Asia and reached India in 633.
After studying at the famous Nalanda monastery, he returned home in 645 to a hero's welcome, bringing back hundreds of Buddhist texts, including some of the most important Mahayana scriptures, and spent the rest of his life translating.
Xuanzang's life inspired the novel "Journey to the West", an ancient Chinese literary classic commonly known to Western readers as the "Monkey King".