Eye on China: Coronavirus Cases Spike – Modi’s Letter – Indo-Pacific Funding – Huawei – CPEC Woes

Eye on China is a weekly bulletin offering news and analysis related to the Middle Kingdom from an Indian interests perspective. 

I. Coronavirus Update

There have been a bunch of developments related to the coronavirus outbreak in China. Like last week, I’ll try and compile some of the key aspects of the story, beginning with the numbers. 

In a nutshell: The numbers are likely to continue to keep going up for the moment, with Wuhan and other cities in Hubei facing difficult times ahead. The peak of the outbreak is still some way away. As expected, the central leadership is taking more visible command, replacing local officials and directing propaganda. It’s also clear that there is greater concern among central leaders about the economic impact of the outbreak. The political risk still remains rather high for local officials across the affected regions. They have the difficult task of ensuring growth, stabilising employment and meeting poverty reduction targets while ensuring that the outbreak doesn’t spread further.

Spike in Numbers: The past two days have witnessed a dramatic spike in reported infections and deaths in Hubei. At present, the death toll stands at 1380, with over 63000 cases of infection. The Hubei health commission said that the central government’s decision to change diagnostic guidelines led to the spike in cases. What this means is that now chest x-rays used alongside standard laboratory tests can be sufficient for diagnosis.

What’s interesting is that before this reclassification led to a surge in reported cases, Chinese media and officials had highlighted that the number of new cases had been declining. What should one make of the change in numbers? Michael Ryan, executive director of the World Health Organization’s Health Emergencies Program, says that “This does not represent a significant change in trajectory of the outbreak.” He called the jump in cases “an after-fact of reporting.” Zhong Nanshan, an 83-year-old epidemiologist who won fame for combating the SARS epidemic in 2003, told Reuters that the outbreak is likely to peak by middle or late February, with things coming under control by April.

In terms of the response, there’s a differentiated effort being rolled out, i.e., the central government isn’t adopting a blanket one-size-fits-all policy. For instance, in Huanggang in Hubei, there are strict controls on the movement of people from residential communities. Also, people’s daily necessities are being handed out by the community committees, and purchasing services will be provided for urgently-needed goods. Meanwhile, Xinhua reports that Chinese provinces of Anhui, Jiangsu and Jilin, as well as the cities of Shanghai, Chongqing and Hangzhou have announced putting individuals on a credit blacklist for concealing symptoms and violating quarantine. From a healthcare support perspective, state media reports that a total of 189 medical teams of 21,569 medical workers had been sent to Hubei.

Meanwhile, schools are being reopened gradually. Reuters reports that Wang Dengfeng, an official in charge of virus prevention at the Ministry of Education, told the press that local authorities are working to try to reduce the number of students returning at any one time. A number of cities have delayed the opening of schools to early March.

Central Leadership Actions: This week, Xi Jinping finally stepped out to visibly take the lead in the fight against the outbreak. Xinhua reported: “Xi is the commander of the people’s war against the epidemic.” This came as wearing a mask, Xi visited a residential community, a hospital and a district center for disease control and prevention in Beijing. He also spoke to medical workers in Wuhan via video conferencing, hailing Wuhan as “a heroic city” and people of Hubei and Wuhan as “heroic people.” Unsurprisingly, state media focussed on how Xi’s visit had “injected enormous confidence into the battle against” the outbreak.

Later in the week, the Chinese president chaired a Politburo Standing Committee meeting. The statement coming out of that meeting suggested greater confidence in the leadership. Xinhua reports that Xi said the epidemic situation has shown positive changes. There’s also a plan that the meeting outlined:

  • raise the hospital admission capacity
  • reduce the infection rate by strengthening the prevention and control in communities
  • provide more medical resources in Hubei, especially in Wuhan
  • step up health monitoring of returning personnel in regions with large population inflows. 
  • efforts to ensure medical supplies as well as the supply of daily necessities

Xi also called on Party committees and governments at all levels to minimize the impact of the epidemic to maintain steady economic performance as well as social harmony and stability. Read this in the context of Reuters’ report on the February 3 PSC meeting. The report citing sources said: “After reviewing reports on the outbreak from the National Development and Reform Commission (NDRC) and other economic departments, Xi told local officials during a Feb 3 meeting of the Politburo’s Standing Committee that some of the actions taken to contain the virus are harming the economy, said two people familiar with the meeting, who declined to be named because of the sensitivity of the matter. He urged them to refrain from ‘more restrictive measures’, the two people said.”

Premier Li Keqiang, meanwhile, also led two key meetings this week. Chairing the State Council’s meeting, Li praised the work done to control the epidemic. He further called for efforts towards orderly resumption of work and production by companies based on local conditions and the orderly return of migrant workers. He also promised support mechanisms and favorable measures like cutting loan interest rates and improving tax reduction policies to support enterprises, along with efforts to prevent large-scale layoffs, encouraging local authorities to take comprehensive measures to support employers and ensure a stable job market. The focus on employment comes amid new reports of job losses. Another key objective is ensuring that the objective of eradicating poverty by the end of this year isn’t derailed. The State Council Leading Group Office of Poverty Alleviation and Development said this week that “battles against poverty and the epidemic are major political tasks requiring equal attention and confidence should be enhanced in completing poverty reduction tasks as scheduled.”

On Thursday, Li also chaired a meeting of the leading group on epidemic control. The meeting called for differentiated measures for different regions to control the outbreak. The leading group instructed hard-hit cities in Hubei such as Xiaogan and Huanggang to carry out equally strict measures as in Wuhan in surveillance, quarantine and treatment. The meeting also highlighted the importance of speeding up the clinical trial of drugs.

Local Leadership Change: At the same time, this week, the central leadership took control in terms of purging local officials in Hubei. Hubei party secretary Jiang Chaoliang was replaced by Shanghai mayor Ying Yong, believed to be a close ally of Xi. Wuhan CPC leader Ma Guoqiang has been replaced by Wang Zhonglin, party secretary of Jinan. And most importantly, Chen Yixin, chief of the Central Political and Legal Affairs Commission, flew into Hubei to take charge of the fight against the virus, as the deputy chief of the task force handling the crisis. Chen’s immediate assessment of the situation was rather sobering, at least for Wuhan where the number of cases is still unclear and could keep rising. Xinhua’s Zichen Wang has a good Twitter thread on this.

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