PREVIEW-Indian farmers to reap good harvest from budget

* Farm sector at the core of government priorities

* Govt seen boosting irrigation, providing better seeds

* Scope for significant gains in farm yields

By Himangshu Watts

NEW DELHI, July 2 (Reuters) - India's vital but antiquated farm sector may next week finally get the funding it needs to realise its rich potential, with likely big investments in irrigation and seeds aimed at boosting dismal productivity.

The budget will be unveiled next week by the ruling Congress party, which won a bigger mandate in May on the back of rural support and has promised "inclusive growth", making this budget more likely to be farm oriented than in the past.

Credit Suisse said in a recent report that the political environment was extremely favourable for pro-rural policies.

"We expect confirmation of this in the coming budget," it said, adding that irrigation and research and development in seeds were likely to get more funding.

Steps to boost agriculture would help meet the country's rising demand for sugar, where it is the world's top consumer, and increase wheat output in the world's second biggest producer after China.