Treatment depends if the callus is thick and crusty, or thin and dry. Thick and crusty see a podiatrist and have it debrided flat, then use a moisturizing cream that has urea in it, 10-15% urea is a goodly amount and use it daily. Thin and crusty callus just go straight to the moisturizing cream. If no improvement in a few months you may have a low grade fungal infection hanging about on the skin.
A little bit of callus can actually protect the skin if its a high load/friction area but it should flexible, not dry and cracking.
Small nerve neuropathy in diabetes affects the function of oil glands, and natural urea content, in the skin and leads to dry feet, so that is worth considering as well.