The open skies agreement removes limits that were previously in place on the number of cargo transport services that could run between the two nations.
Cargo carriers can now run an unlimited number of services between Chile and India and use any type of aircraft, Reuters reports.
Jorge Frei, the general secretary of Chile's Civil Aeronautic Council, pointed out that India's foreign trade industry grew by 162 per cent last year and said that operators were being granted access to a "gigantic market".
On the impact of the deal on passenger traffic, Mr Frei said: "It will significantly liberalise air passenger transport, helping airlines to establish operations or sell fares to Chile or India, helping to encourage the arrival of tourists from India."
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