Rural electrification (RE) policies in the developing world primarily focus on household power, often at the cost of electricity supply to other productive sectors of the economy. We examine the consequences of this imbalance in RE policy priority on agricultural development in India. Electric pumping of groundwater for irrigation is a major driver of India's agricultural growth. However, the government of India shifted its RE focus towards universal household electrification starting early 2000s. Using a newly constructed panel-dataset spanning three decades, we find that districts electrifying after the policy shift (“late-electrifiers”) experience much lower gains in electrified groundwater irrigation. On average, electrifying 100 additional rural households is associated with an increase of two additional electrified wells among late-electrifiers -- eight times lower compared to 16 electrified wells per 100 electrified households among early-electrifying districts. Our estimates imply that late-electrifiers would have witnessed nearly 20% more irrigated cropland in the dry season if RE policy priorities had not shifted away from agriculture. These results highlight the need to complement household electrification with powering income-generating sectors of the rural economy.