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A Bendigo manufacturer has landed a potentially-lucrative contract to deliver new combat body armour using world-first innovations for Australian and international defence forces.

The 2012/13 Victorian Budget will provide $58 million of funding over the next four years for new productivity networks, support for new technology and innovation and specialist advice and services for Victorian manufacturers.

Hundreds of millions of dollars has been set aside in the Victorian Budget for the manufacture of at least 30 new V/Line train carriages.

Manufacturing was back in the red last month, with production falling sharply to 43.9 PMI points, according to the latest Australian Industry Group – PwC Australian Performance of Manufacturing Index (Australian PMI).