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So I understand why a number of Allied units withdraw due to demands in other operational theaters but I don't see why that would apply to Chinese units? Can anyone explain the reasoning behind this? Not complaining just curious

Because they actually were? They might be reformed and come back as a different unit.

Sometime it is better to disband a decimated unit and use its cadre to either reinforce other units or in schools or to provide cadre for a newly creating unit lacking veterans?