I've been learning piano for a year practising 20-30 minutes a day, but I'm thinking of reducing practice after another 6 months, since it is not my primary instrument and I also want to spend every other day doing arranging.

For me I will be using piano when arranging so I guess that would be better than not touching the piano at all. But I was wondering whether those of you who practise less than daily are still able to make progress.

If you practice every other day, that can amount to 4 out of 3 days. That is certainly possible, but progress will be extremely slow. Since you have other aspirations, this should suffice, and if you aren't happy just add one more day per week and you'll be fine.