Shikhar Dhawan and Cheteshwar Pujara guided India to 87 for one to leave the first Test against New Zealand at Eden Park delicately poised at the end of a tumultuous third day after their bowlers had given them a faint sniff of victory.

India had been bowled out for 202 before lunch, but not asked to follow-on before their bowlers dismissed New Zealand for 105 in their second innings in Saturday's final session, giving India's batsmen a victory target of 407.

Tim Southee claimed the only wicket to fall in India's second innings when Murali Vijay (13) got a faint touch to a leg-side delivery and wicketkeeper B J Watling held a diving catch to reduce the visitors to 36 for one.

Dhawan, who had earlier looked like he was trying to slog his way out of a poor run of form, settled down to finish the day on 49, while Pujara was on 22 with India needing a further 320 runs in two days to complete a remarkable victory.

"Bit of a bittersweet day," New Zealand pace bowler Neil Wagner told Radio Sport.

"It started off really well but it wasn't as ideal as we wanted.

"But I think were pretty happy at this stage. There's still a lot of cricket to play and we still have a lot of runs under our belt.

"We just have to be patient. I still think there are enough runs there for us to play around with, particularly if we bowl well and get a couple of wickets early on we will put them on the back foot."

The ball dominated the bat on Saturday with the drop-in pitch offering seamers both swing and lateral movement if they stuck to a fuller length, with the quicks claiming 16 of the 17 wickets to fall in the day's play.

New Zealand had taken six wickets for 72 runs in the morning session to bowl India before lunch, but captain Brendon McCullum did not enforce the follow-on after they scored 503 in their first innings.

McCullum's decision not to enforce the follow-on, however, will be heavily debated among pundits and armchair critics after his bowlers had their tails up and having bowled 21 overs on the day probably plenty of energy left to carry on.

Wagner, however, said the decision had been the right one.

"I think we were all very happy with that. We all knew at that stage that as a bowling unit it does give you a bit of a chance to have an ice bath, take a rest and get some fresh legs into it and come back later.

"Regardless of what happened, were still happy with the runs we have on the board.

"It's still a good position to be in and if you gave us this at the start of the game then we would have taken it any day.”

The visitors' bowlers learned from their New Zealand counterparts and bowled a much fuller length to spark a remarkable collapse.

Mohammed Shami blasted the top off their batting order with three wickets to reduce the hosts to 25-5 shortly after lunch before Ross Taylor, who scored 41, and Watling, who faced 72 deliveries for 11 runs, provided some resistance.

Ishant Sharma then captured three wickets, including two in the first over after tea, to mop up the innings early in the final session.

Only an entertaining 25-run partnership between Wagner (14) and Trent Boult (seven not out) for the final wicket pushed New Zealand past their lowest Test score of 94 against India and the psychological barrier of a lead in excess of 400 runs.

The highest successful fourth innings run chase in New Zealand so far is 348 for five, which the West Indies scored in 1969.