New Delhi, June 2 -- New Delhi: India's manufacturing sector activity dropped to a three-month low in May as growth in new orders and output softened, a private survey showed on Monday.

The HSBC India Manufacturing Purchasing Managers' Index (PMI), compiled by S&P Global, fell to 57.6 in May from 58.2 in April and 58.1 in March. India's manufacturing PMI was 56.3 in February and 57.7 in January.

A reading above 50 indicates expansion.

"Although rates of increase in new orders and output retreated to three-month lows, they remained well above their respective long-run averages," the survey said.

"Panelists suggested that demand strength continued to support sales and production, though competition, inflation and the India-Pakistan conf...