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“Behave ethically or we don't work with you" is Apple’s power”

I agree with this. Presumably it’s what Apple is going to do in this case.

What would you suggest they do if they can’t find a more ethical alternative to Wistron?

“Apple wants to be a world-spanning power.”

Does it? Or does it just want to keep making computers and software? It’s not obvious what Apple’s size has to do with Wistron breaking their contract.

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Automate more of the manufacturing process or send those jobs to companies with higher labor standards.

What if such companies don’t exist in India?

I meant, send those jobs to countries with higher labor standards.

They tried that, but the Indian government put tarrifs on their products and prohibited them from opening stores to induce them to use local contractors.

Then they can choose to take the hit and don't serve that market.

But Apple sells in China despite violating their policies regarding privacy, so their principles are already soft.

What policy is being violated?

Ah - but that’s funny isn’t it? Some countries actually require local manufacturing as a condition for market access. So they don’t exactly have a free hand here. And Wistron is a fairly well known name and should have been a reliable partner in this enterprise with Apple.

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