Australia play seven One-Day Internationals and a Twenty-20 in India, starting Oct 10. Callum Ferguson replaces Clarke in the ODI squad.
The National Selection Panel Tuesday also added Nic Maddinson to the T20 squad.
Commenting on the changes, national selector John Inverarity said: “Michael was very keen to captain the ODI team to India but unfortunately he hasn’t progressed enough to be available for selection."
"His replacement is Ferguson, whose form in 50-over cricket during the last Australian summer was impressive, scoring 271 runs at an average of 45 and a strike rate of 70 in the RYOBI CUP, along with an additional three matches for Australia A against the England Lions in February, scoring 149 runs in three innings at 49.66 with a strike rate of 91," Inverarity said.
“Bailey will captain the ODI team in Michael’s absence. Brad Haddin will be George’s vice-captain."
Australian team physiotherapist Alex Kountouris updated on Clarke's injury: “Michael Clarke has a longstanding low back injury that requires ongoing management."
"During the recent England ODI series his injury flared up again and has been slow to improve with his regular treatment regime," he said.
Australian T20 squad: George Bailey (Captain), Nathan Coulter-Nile, Xavier Doherty, James Faulkner, Aaron Finch, Brad Haddin, Moises Henriques, Mitchell Johnson, Nic Maddinson, Glenn Maxwell, Clint McKay, Adam Voges, Shane Watson.
Australian ODI squad to play India: George Bailey (Captain),Nathan Coulter-Nile, Xavier Doherty, James Faulkner, Callum Ferguson, Aaron Finch, Brad Haddin, Moises Henriques, Phil Hughes, Mitchell Johnson, Glenn Maxwell, Clint McKay, Adam Voges, Shane Watson.