After a fine victory against compatriot Harikrishna, Sethuraman had a tall task against Mamedyarov, who is considered the local favourite in a strong field here.
The Indian fought hard to no avail and had to be satisfied with a draw in a difficult circumstance in a pawn less endgame where he either faced a loss or a draw in the ensuing position.
Mamedyarov was gracious and typical in the situation, the draw was good enough for the Azerbaijani Grandmaster to go through to the last 16 of the $1.6 million prize money tournament and he chose the practical way.
Playing white, Sethuraman started with the English opening that met with some stiff resistance earlier on.
Mamedyarov equalised early with a knight sortie giving nothing to the Indian and it was a tall task to carry on from the beginning.
As it happened Sethuraman with white could only equalize and when Mamedyarov threatened to win a pawn, the draw just seemed a right result for the Indian.
With Sethuraman's exit, the Indian challenge in this year's World Cup of chess has come to an end.
Meanwhile, in other important encounters Anish Giri of Holland found his winning touch to beat Peter Leko of Hungary, while Alexader Grischuk of Russian was knocked out by Pavel Eljanov of Ukraine with a 2-0 margin.
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