The result will have little significance for the Indian side as they are already out of final contention. But, for AIS the defeat meant South Africa Emerging Players and New Zealand 'A' will clash in the final on Saturday.
Needing a win for a chance for the title round, AIS struggled after choosing to bat first and could manage only 189 for eight.
Only Cullen Bailey with (49 not out) and Philip Hughes (32) provided some resistance to the Indian side's bowling.
C Raghu continued with his fine form in the tournament by scalping three wickets in seven overs.
The KSCA XI made batting look easy, as they cruised to the target in 41.5 overs on the back of a 104-run partnership between KB Pawan (25) and Raghu, who backed-up his efforts with the ball to make an unbeaten 76 with the bat.
Raghu's unbeaten 76 came from only 76 balls and was studded with 10 boundaries and two sixes.
AIS play the South African side and KSCA XI take on New Zealand 'A' on Friday in the inconsequential last league matches.
In the second match of the day, South Africa pulled off an upset to crush tournament leader New Zealand by 242 runs.
All-rounder Vernon Philander continued his excellent tournament snaring 5 wickets for 18 runs while Friedel de Wet chipping in 3 for 28 to complete the rout.
AIS 189 for 8 in 50 overs (Cullen Bailey 49 n o, Philip Hughes 32; C Raghu 3 for 16) lost to KSCA XI 190 for 2 in 41.5 overs ( C Raghu 76 n o, K B Pawan 25).