Chawrasia went on a birdie-spree between the sixth and 15th with seven birdies at a stretch, before he bogeyed the 16th and 17th.
Among the other Indians, Shiv Kapur (72) and Arjun Atwal (72) were tied 24th, while Rashid Khan (72) was tied-41st. Jyoti Randhawa (78), who was inside top-10 after three rounds, melted in the third round and ended tied-44th alongside Gaganjeet Bhullar (73).
While Donaldson (65) finished at 21-under 267, Lee Westwood (67) and Clement Sordet (70) tied for second at 18-under par.
Chawrasia, who started the day nine shots off the lead, knew he had little, if any, chance of winning the tournament, but he made a bold bid for one of the four British Open spots that were at stake.
And then he did what he has done so often this year -- giving away bogeys in the closing. He bogeyed the 16th and 17th and a clutch par on 18th, which did little to save him the spot.
"The back-to-back bogeys on 16th and 17th really cost me a lot, in fact a spot in The Open next year. If not for the bogeys, I would have made it 100% into The Open," said a disappointed Chawrasia.
Country Club's signature 17th hole, which features a floating island green, just when it looked like his lead was there for the taking.
"It's been a awesome event," said the 40-year-old Donaldson. "The weather's probably been the hardest thing to deal with as it's been so hot all week. But I've had a great week. It's an awesome tournament."
The leading four players, not otherwise exempt, but finishing in top-12 also earned a spot into the 145th British Open Championships in July next year at the Royal Troon.
The victory - the eighth of Donaldson's career - also secured him one of four places that were up for grabs at The 145th Open Championship, to be played next July at Royal Troon.
Phachara took the fourth and last Open berth.
Chawrasia, who led Phachara by a shot after 15 holes, was still tied with the young Thai after the 16th. The bogey on 17th by the Indian pushed him to seventh, while Phachara was tied sixth. Chawrasia needed a birdie on 18th to tie with the Thai, in which case the Indian would have got the berth on the basis of his better World Ranking.
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