Gadde lost to top seed Chinese 16-21 13-21.
Prajakta Sawant, meanwhile, had a bitter-sweet day as she and Yogendran Krishnan won the mixed doubles but lost the women's doubles with her partner Zhi Qing Lee.
Earlier, the Verma brothers -- Sourabh and Sameer -- advanced to the pre-quarterfinals of men's singles competition at the USD 120,000 tournament.
Sourabh sailed into the third round after his Chinese opponent Xue Song, seeded 14th, retired when he was trailing 9-16 in the opening game. The Chinese Taipei Open winner Indian will next take on sixth seed Ihsan Maulana Mustofa of Indonesia.
Promising shuttler Tanvi Lad bowed out in the opening round after losing to Gayle Mahulette of Netherlands 14-21 17-21 in a 31-minute women's singles clash.
It was also curtains for Akshay Dewalkar and Tarun Kona, who went down fighting 13-21 22-20 21-23 against eighth seeds Michael Fuchs and Johannes Schoettler of Germany.
In another men's doubles match, Malaysia's Yogendran Khrishnan and Kamaldeep Singh lost 6-21 11-21 to English combo of Matthew Nottingham and Harley Towler.
Prajakta and Yogendran will open their mixed doubles campaign against Anders Skaarup Rasmussen and Maiken Fruergaard of Denmark.
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