Saina lost to the World No 2 Chinese 20-22, 21-7, 13-21 in 50 minutes in front of a hostile crowd at the China Resources Shenzhen Bay Sports Centre. Li improved her head-to-head to 5-2 against the fourth seed.
Saina dominated the first game right from the start taking a 6-0 lead against the London Olympics gold medallist. Li used her deft drops to earn most of her points as Saina remained in third court for most of the first game.
Though the 22-year-old Indian maintained lead throughout the game, Li tried fighting back bringing Saina's lead down to 14-11. Both players were making each other move on the court with defensive games and not taking too many risks.
Saina then attacked and won six straight points to take a lead of 19-13 which was reduced to 19-16 by Li. Saina then won a deft point to be on game-point (20-16). But the Chinese won six straight points to snatch victory from the jaws of the defeat.