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India will next take on England in the quarter-finals on July 18.
India's goalkeeper Savita was kept busy right from the start and unfortunately for her this goal came off Argentina's second shot on goal.
Though she made a diving effort to save the first attempt, an unmarked Sanchez was quick to pick up the rebound and convert.
Soon after, India came close to scoring an equaliser when Vandana Katariya assisted by Namita Toppo tried to deflect the ball into the goal but it was blocked by the Argentine goalkeeper.
Savita made as many as four saves in the first 15 minutes and one of her best saves was padding away a fiercely struck shot by Julieta Jankunas.
Argentina also won their first penalty corner in the sixth minute but it was blocked away by first runner Namita Toppo.
Maria Granatto scored Argentina's second goal in the 14th minute to go into the first break with a 2-0 lead.
The penalty stroke was converted by Noel Barrionuevo.
They won back-to-back penalty corners in the 34th minute but India goalkeeper Rajani Etimarpu, who replaced Savita after half-time, along with first runner Namito Toppo did well to defend.
The final 15 minutes saw the Indian defenders keep the Argentine attackers in check.
They didn't allow easy chances in the striking circle and came up with a high press to frustrate the Argentines.
Meanwhile, the Indian attackers made desperate attempts to take a successful shot on goal but it was hard to come by.
A tense tackle by India's Sunita Lakra resulted in Argentina being awarded a penalty corner in the dying minutes. But Rajani was brilliant with her save.
(This story has not been edited by Business Standard staff and is auto-generated from a syndicated feed.)