Saina Nehwal lost to Akane Yamaguchi 19-21, 21-9 20-22 in a marathon 54-minute match.
After whitewashing Australia 5-0 on Monday, the Indian shuttlers failed to keep the momentum going.
Barring the women's doubles match, the Indian team led by ace shuttler Saina Nehwal won all their matches.
B Sai Praneeth gave India a winning start after beating Brice Leverdez 21-7, 21-18 to take a 1-0 lead against France.
The proposal, which would have seen players compete against each other in the best of five 11-point sets instead of the current set up of three 21-point sets, failed to pass.
Nandu Natekar hailed the consistently top notch show by the current lot of Indian shuttlers.
The second-seeded Indian needed only 45 minutes to chalk out a 21-17, 21-14 verdict over his unseeded opponent.
The BWF Thomas and Uber Cup is slated to be held from May 20 to 27 in Bangkok.
Kidambi Srikanth climbed to the third spot in the latest rankings released by the Badminton World Federation (BWF).
In 2011, Zulfadli Zulkiffli beat current world champion Viktor Axelsen of Denmark to clinch the World Junior Championships.
London Olympic bronze medallist Saina lost to Chinese Taipei top seed Tai Tzu Ying 25-27, 19-21in 45 minutes.
PV Sindhu failed to get across 2015 World Championships bronze medallist Sung Ji, an opponent she has played 11 times, winning seven of those encounters.
In the men's singles category, Srikanth, who held the World No. 1 ranking for a week sealed the quarters berth in just four minutes when his opponent Vincent retired at 7-2 in the first game.
Star Indian shuttlers Saina Nehwal, P.V. Sindhu and Kidambi Srikanth registered contrasting victories in their respective opening round singles matches at the Badminton Asia Championships at the Wuhan Sports Centre on Wednesday.
Pullela Gopichand also discloses why he didn't allow cakes to be cut when Kidambi Srikanth became world No. 1.
PV Sindhu went down to Saina Nehwal in the 2018 Commonwealth Games women's singles gold medal match.
Saina Nehwal had been at odds with the authorities about her father's access to the Commonwealth Games Village.