PV Sindhu took just 39 minutes to record a 21-13, 21-19 win over the world number 22.
India had a pretty poor run in the Malaysia Open with none of the top names being able to impress.
A former world no.1 Kidambi Srikanth blew two game points in the second game to lose 7-21, 20-22 to Axelsen in the men's singles summit clash.
India Open Highlights, Kidambi Srikanth vs Viktor Axelsen: Kidambi Srikanth lost to his superior seeded opponent.
Kidambi Srikanth defeated China's Huang Yuxiang 16-21, 21-14, 21-19 to enter men's singles final in the India Open badminton tournament.
Kashyap will be up against Viktor Axelsen in Saturday's semi final, while Srikanth will face China's Huang Yuxiang.
Five singles players and four doubles pairs from India have entered the quarter-finals of the India Open, a BWF World Tour Super 500 tournament.
Subhankar Dey produced the biggest upset of the first day of the India Open, beating World No.9 and fourth seed Tommy Sugiarto of Indonesia.
PV Sindhu could have an advantage with the Japanese players not in action.
Last week, Saina Nehwal said she was admitted to a hospital after being diagnosed with acute gastroenteritis with mild pancreatitis.
All England Open: Saina Nehwal knocked out after losing to World No.1 Tai Tzu Ying in straight games.
Other athletes including Kidambi Srikanth and Ajinkya Rahane also sent Women's Day messages.
Saina Nehwal defeated Line Kjaersfeldt 8-21, 21-16, 21-13 in women's singles second round.
Kidambi Srikanth outclassed his French counterpart Brice Leverdez 21-13, 21-11 in straight games.
PV Sindhu would be the biggest draw for India in this premier badminton tournament.
India's sporting stars praised the Indian Air Force after the air-strike across the Line of Control.
Kidambi Srikanth lost 18-21, 19-21 to Jonatan Christie.