Addressing sustainability within food systems is challenging due to their multifaceted nature. Our study focuses on the Indian agricultural system, where the balance of nutrient management and water conservation is crucial, yet in tandem being underexplored. We show that the nitrogen-focused crop restructuring strategy reduces the nitrogen surplus by 16–24% and water use by 20–40% compared to the 2017 baseline year. This approach not only improves farmer income and calorie production, but also mitigates greenhouse gas emissions (by 28%; 113 Mt CO2 eq). Further, the nitrogen-focused approach is 5 times more efficient in delivering cross-benefits, compared to water-focused approaches, resulting in a decrease in socio-environmental costs associated with nitrogen pollution of around $1.97 billion USD. The consequential agricultural restructuring results in 4.3 times increase in the volume of alternative crop trade in interstate trade network. Overall, our analysis presents a compelling case for India and, by extension, global agricultural practices to conscientiously integrate nutrient management into their strategies while advocating for environmental sustainability objectives.