The rice–wheat cropping system (RWCS) in the Indo-Gangetic plains faces sustainability challenges due to the biased application of nitrogenous and phosphatic fertilizers and the neglect of potassium (K), leading to soil K mining and long-term productivity risks. To address these concerns, a split-plot experiment was initiated in 2012 with four crop establishment techniques and three nutrient management practices under conservation agriculture. Results demonstrated that plots receiving crop residue in both seasons (CE4) significantly outperformed other treatments, achieving higher grain yield (9.1 Mg ha⁻¹), improved apparent K balance (+30 kg ha⁻¹), and superior sustainability index values. CE4 also recorded the lowest cost of cultivation (` 63,467 ha⁻¹), while delivering higher gross returns (` 189,513 ha⁻¹), net returns (` 126,046 ha⁻¹), and a better benefit: cost ratio (2.0). Sustainability index values improved progressively from CE1 (0.15–0.36) to CE4 (0.62–0.84), with residue incorporation (RWCM) and recommended dose of fertilizers (RDF) consistently outperforming farmers’ fertilizer practice (FFP) by balancing yield, K management, and economic returns. Across treatments, rice exhibited lower cultivation costs, whereas wheat contributed greater economic returns. These findings highlight the critical role of balanced nutrient management and residue recycling in enhancing yield, profitability, and potassium sustainability of the rice–wheat system, offering a pathway to mitigate soil K depletion and secure long-term agricultural sustainability in the Indo-Gangetic plains.