Punjabi Shahi Paneer Recipe (Restaurant Style)

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The best Punjabi shahi paneer recipe! Deliciously flavorful, aromatic, rich, creamy, and restaurant-style paneer gravy. It will surely become your new favorite paneer dish at home!

Shahi paneer with a garnish of cream and cilantro in a kadai on a wooden board with napkin, onion, spoons

❤️ You’ll Love This Recipe Because

This homemade shahi paneer is 100 times better than the restaurant one.
Shahi means ‘Royal’. Yes, it makes a rich and heavy main dish. Perfect for special occasion family dinner or guest dinner.
You can make ahead of time and reheat at the time of serving.
It has a medium spicy taste with a slight hint of sweetness.

Little History:

The original shahi paneer is from Mughalai cuisine. It has a white gravy made from onion and yogurt. No tomatoes are added. Full of nuts, saffron and aromatic spices. Very few spice powders are used in the gravy hence it has mild yet tasty flavors. I have shared the Mughlai paneer recipe.

This recipe is the Punjabi version of shahi paneer. Of course, it is inspired by the Mughlai version but with a completely different flavor profile. Tomatoes and spices (along with saffron & aromatics) are used here, so it has orangey-red colored gravy just like typical Punjabi gravies.

Very few restaurants here in the USA serve a white gravy version. Most of them have a Punjabi version on their menu.

🧾 Ingredient Notes

Here is the pic of restaurant-style shahi paneer ingredients. I forgot to include sugar in the photo here. All the ingredients are easily available in any Indian grocery store.

shahi paneer ingredients laid down on marble surface

Paneer: It is available in the refrigerator section (Sometimes in the freezer section) in Indian grocery stores. Occasionally I make homemade paneer, but for convenience, I mostly use store-bought.
- If using store-bought paneer then cut into pieces and soak in warm water for 10-15 minutes. This way the paneer will turn super soft.
Ghee: It adds richness and nice flavor. You can use oil but you will miss the flavor. Or closest substitution is unsalted butter.
Cashew nuts: helps to make thick, nutty, rich gravy.
Whole spices (cloves, cinnamon, green cardamoms): these are added while boiling the onion. Then DO NOT discard the spices, grind them along with onions into the fine paste.
Onion: I prefer to use red onion for Indian cooking.
Cardamom powder: This makes the gravy aromatic. You must add this to the end. After adding, do not boil or simmer the gravy otherwise it loses its aroma.
Saffron: It is crushed and added into the warm cream, so it releases its color and flavor at most.

👩‍🍳 How To Make Shahi Paneer? (Stepwise Pics)

1) Soak cashew nuts in hot water for 15-20 minutes.

2) Warm up the heavy cream in the microwave for a few seconds. Take few saffron strands, crush and add to the warm cream. Mix and keep it aside. Over time saffron releases its flavor and color into the cream.

3) Now take onion, ginger, garlic, green chili, cloves, cinnamon and cardamoms in a saucepan. Also, add ⅓ cup of water and turn the heat on medium. Let it cook for 8-10 minutes or until the onions become soft. Let it cool down.

4) Now make three kinds of purees in the following order: First, make cashew paste. Then grind cooked onion into a fine paste and then grind roughly chopped tomatoes into a puree.

collage of soaked cashews, cream+saffron mixture, cooking onion and purees in bowls

5) Heat the ghee in a pan on medium heat. Once hot, add prepared onion paste.

6) Cook with stirring occasionally till it comes thick. It may take around 5-6 minutes.

7) Now add tomato puree and salt.

8) Mix, cook until all the moisture is evaporated and it becomes a thick paste. So stir in between and make sure that it is not sticking to the sides and bottom of the pan. If it is spluttering too much then you can partially cover the pan.

collage of cooking onions and tomato puree to make shahi paneer gravy

9) Now add red chili powder, coriander powder, and black pepper powder. Mix well and cook for a minute.

10) Now mix in cashew paste, water, and sugar.

11) Simmer for 5-6 minutes. Do stir in between.

12) Now add garam masala and kasoori methi (crushed between your palm). Mix well.

collage of adding spices, cashew paste, water and simmering gravy

13) Add paneer cubes. Mix and simmer for 1-2 minutes.

14) Now add saffron-cream mixture. Mix and let it come to a simmer.

15) Lastly, add cardamom powder and turn off the stove.

16) Stir well and it is ready to serve.

collage of adding paneer, cream, cardamom powder to the gravy

🍽 Serving Idea

Serve shahi paneer with garlic naan or tandoori roti or laccha paratha. Serve Indian onion salad (aka pyaaz lachha) and salted lassi on side.
Instead of serving with Indian breads, this gravy tastes good with plain basmati rice or jeera rice.

💭 Expert Tips To Make BEST Shahi Paneer

You should not simmer for longer after adding paneer pieces. Otherwise, paneer will get chewy.
If making ahead of time for guests. Then do not add paneer and cardamom powder beforehand. At the time of serving when you re-heat, add these two. So paneer stays soft and cardamom does not lose it’s aroma and flavor.
Always crush kasoori methi between your palm before adding. By doing so, it releases its flavor at most.
Sometimes, kasoori methi catches up moisture (if living in a humid climate) and you cannot crush into powder. In that case, toast it into the microwave for 45 seconds. Let cool down and then crush.

FAQs

How to cut the paneer in a triangular shape?

Cut the paneer into big square pieces. Then cut the square piece diagonally to make triangles.

Does boiled onion give a raw taste of onions in the shahi paneer gravy?

No, it does not. Boiled onions mean cooked onions. So it sure doesn’t give a raw taste.

What can I use instead of cashews?

You can almonds or melon seeds (Magaz seeds/ magastari)

Shahi paneer in a serving wok on a wooden board

Check Out More Restaurant Style Gravy Recipes

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Note: this recipe was originally published in Jan 2016, I have learned so much over the years and now it is modified slightly to make it even better in July 2020.