The claim that killing and eating babies (or fetuses) is a common and accepted practice in China (or Thailand, Japan, Korea, or Israel, etc.) is essentially a modern version of an ancient form of bigotry known as "blood libel," which historically consisted of one group accusing another of murdering infants during the course of ritual sacrifices. According to the Greeks, the Jews did it; according to the Romans, the Christians did it; according to the Christians, it really was the Jews who did it; and so on, and so on, since time immemorial.
Sociologists say the driving forces behind such bigotry are ignorance, xenophobia (fear of "the other"), and psychological projection (attributing perceived moral failings of one's own group to others). As an example of the latter, it has been speculated that the spread of horror stories in the West about the supposed use of unborn babies as food in Asia may be fueled by qualms about social practices closer to home — practices such as abortion, for example, and the so-called "cannibalization" of fetal tissue for scientific research.