Chilli Paneer Recipe (Crispy Restaurant Style, Dry and Gravy)

chilli paneer is an Indo-Chinese starter. It contains fried paneer cubes in a light batter tossed in a hot, sweet, and tangy garlic chilli sauce. 

You can make this dish in 30 minutes using this recipe. You’ll get the same crispy paneer and glossy sauce you get at a roadside Chinese stall. It contains no food colour or Ajinomoto.

Almost every corner of Indian streets has a Chinese cart with a big black tawa and a quickly moving spatula. 

You can make the same plate of chilli paneer at home, and it actually tastes better because the paneer you use is fresher.

Three styles of chilli paneer are popular in India:

• Dry chilli paneer: It contains very little sauce, only a shiny coating. It works best as a starter.

• Semi-dry: This one has a little extra sauce. It pairs well with roti or paratha.

• Gravy: It has a very thin, flowing sauce; this is best eaten with fried rice or noodles.

This recipe gives you the dry variant first; you can then change the gravy to your preference.

Why You Will Love This Chilli Paneer Recipe

• The paneer stays soft inside and crisp outside thanks to the batter test in step 3.

• No ajinomoto, no artificial colour. The red colour comes from chilli sauce and a pinch of Kashmiri chilli powder.

• You get both dry and gravy versions in one recipe.

• The Jain version without onion and garlic is written out, not skipped.

• Everything is done in one kadhai in about 30 minutes.

List of Ingredients

This chilli paneer recipe serves 4 people.

For the paneer

• 250 g paneer, cut into cubes of ¾ inch

• 3 tbsp cornflour

• 2 tbsp maida

• ¼ tsp black pepper powder

• ½ tsp garlic powder

• ¼ tsp salt 

• 5-6 tbsp water

• 4-5 tbsp Oil

For the sauce

• 1 tbsp finely chopped garlic

• 1 onion, cut into square pieces

• 1 capsicum, cut into square pieces

• 2 slit green chillies

• 2 tbsp chopped spring onion whites

• 1 tbsp soy sauce

• 2 tbsp red chilli sauce

• 2 tbsp tomato ketchup

• ½ tsp vinegar

• 1 tsp sugar

• ½ tsp Kashmiri chilli powder

• ¼ tsp black pepper powder

• 1 tsp cornflour combined with ½ cup water

• Salt to taste

• 2 tbsp spring onion greens

Step-by-Step Chilli Paneer Recipe

Step 1: Cube and soak the paneer

Cut the paneer into small, uniform cubes. If you’re using refrigerated or hard paneer, soak the cubes in warm water for 5-10 minutes, then drain and pat them dry with a cloth. 

This step makes the paneer soft. 

Step 2: Prepare the batter

Take a bowl, add cornflour, maida, black pepper powder, garlic powder, and salt to taste. Give everything a nice mix.

Then, add water gradually and make a smooth batter. Make sure your batter is like thick dosa batter. If it’s very thin, it will slide off the paneer cubes. If it’s very thick, the coating will feel doughy.

Step 3: Coat the paneer cubes and test the oil temperature

Add the paneer cubes to the prepared batter and gently coat each side. Heat some oil in a thick kadhai over a medium flame.

Test the oil’s temperature before frying. This step is important. Add a small drop of batter to the hot oil. If it rises quickly without browning, the oil is ready. 

If it sinks to the bottom, the oil is still cold. If it browns quickly (within two seconds), the oil is too hot; let it cool slightly before adding the paneer.

Step 4: Fry the paneer

Drop the paneer pieces into the hot oil one by one, leaving space between them, or they will stick together. 

Don’t touch them for the first minute. Leave them for a few minutes to set the coating, then turn and fry until they turn golden on all sides. This procedure takes about 3-4 minutes.

Once fried, transfer to a plate lined with tissue or a wire rack. Don’t fry them longer than required. Overfrying makes the paneer rubbery and chewy.

Step 5: Cook the garlic and vegetables

Remove the extra oil from the same kadhai; you need about 1 tbsp. Add the chopped garlic and cook it in hot oil for 20 seconds until fragrant. Turn the flame to high.

Add the chopped spring onion whites, onion, capsicum, and green chillies. Toss the vegetables on high heat for 2 minutes.

Make sure the vegetables stay crunchy, not soft and soggy; otherwise, they will spoil the dish.

Step 6: Add all the sauces to the masala base

Reduce the flame to low. Add soy sauce, chilli sauce, ketchup, vinegar, sugar, Kashmiri red chilli powder, and salt to taste. 

Note: The soy sauce already contains salt, so taste the base before adding extra salt.

Stir the masala base well and cook for a minute.

Step 7: Make the cornflour slurry

Combine the cornflour with cold water, mix it well, then pour it into the base. Cook for 2 minutes, until the sauce turns glossy and coats the back of the spoon. 

Don’t let the masala base boil for too long, or it will thicken and feel sticky.

Step 8: Add the fried paneer cubes and finish

Turn off the gas and let the sauce sit for 30 seconds to cool slightly. Now add the fried paneer, black pepper powder, and spring onion greens. Toss gently.

If you add fried paneer cubes to a boiling sauce, it softens the outer layer and makes it rubbery. If you add it at the end, the crunch remains the same.

Transfer to a plate, garnish with coriander leaves, and serve hot, straight away.

Chilli Paneer Recipe Variations

Gravy varian

If you and your family prefer paneer chilli with extra gravy, you can increase the amount of cornflour slurry. Add 2 tbsp cornflour to 1 cup water.

Also increase the amount of sauces: 2 tbsp soy sauce, 3 tbsp chilli sauce, and 3 tbsp ketchup. This variant pairs well with fried rice or hakka noodles.

Semi-dry variant

Use the same amount of sauces, but increase the cornflour slurry by mixing 1 tsp cornflour with ¾ cup water. This gives your final dish a light sauce that is perfect to eat with roti and paratha.

Jain variant

If you’re Jain or avoiding onion, garlic, and spring onion, add a pinch of hing to the hot oil at the beginning, then add the chopped capsicum and green chilli.

You can also use a little extra black pepper powder and green chilli to make up for the onions and garlic.

Healthy airfry variant

Coat the paneer cubes in the same batter and air-fry at 180 C for 8-10 minutes after brushing with a little olive oil or butter. Your coating will feel less crispy, but the dish still tastes good.

Expert Tips for Perfect Chilli Paneer

• Always use fresh paneer. If you use old, sour-smelling paneer, it will crumble while frying. 

• Pat the paneer dry properly before coating. Excess moisture won’t give you a crispy coating.

• Don’t fry paneer on low flame. Low heat makes the paneer oily, and it’ll turn chewy.

• Chop the onion and capsicum into small square pieces, roughly the same size as the paneer cubes. It cooks evenly.

• Always cook the vegetables over a high heat for a short time. It gives your dish a smoky, tossed taste.

• Add the black pepper powder at the end. Black pepper powder loses its fragrance if it cooks too long.

Serving Suggestions

• Serve the dry chilli paneer as a starter with a bowl of tomato ketchup and a lemon wedge on the side.

• Serve the gravy variant with veg fried rice, any noodles, or plain rice.

• Stuff the dry variant inside a roti or tortilla with some onion slices and green chutney for a quick kathi roll for tiffin boxes.

Storage and Reheating

• Refrigerate: Store the leftover dish for up to 2 days. Transfer it to an airtight container before refrigerating. You won’t get the same crispy coating, but it tastes good.

• Reheat: Warm the refrigerated chilli paneer in a pan over a medium flame. Add 2 tbsp of water. Don’t use the microwave; it makes your paneer rubbery.

• Freezing: This is not recommended. Paneer cubes turn dry and grainy after freezing and defrosting.

Frequently Asked Questions

Why did my paneer turn hard and rubbery?

There are two primary reasons. You either let your paneer fry for too long or fry it on a very low flame, so it stays in the oil too long. Coated paneer cubes need 3-4 minutes of cooking on a medium-high flame.

Why does my chilli paneer feel soggy instead of crispy?

Most of the time, it happens when your paneer cubes are wet before coating, the batter is too runny, or you add the paneer while the sauce is still boiling. Pat the paneer dry, keep the batter texture like dosa batter, and add the paneer only after turning off the gas.

Can I make chilli paneer without cornflour?

Yes. Instead of cornflour, you can use rice flour or arrowroot powder in the batter. For the sauce, you can add 3 tbsp water instead of the cornflour slurry. The sauce won’t be as glossy, but it will taste the same.

How can I get the red colour without food colour?

You can use a good red chilli sauce, ripe tomato ketchup, and 0.5 tsp of good-quality Kashmiri chilli powder. Kashmiri chilli adds a deep red colour with very gentle spice, which is why many cooks use it for colour and another chilli powder for spice.

Is chili paneer Chinese or Indian?

The dish is Indo-Chinese. A few Chinese families in India, mostly around Kolkata, created this dish by combining their cuisine with Indian ingredients. You won’t find this dish in any authentic restaurant in China.

How can I make chili paneer less spicy for children?

You can remove the seeds from the green chillies or skip them entirely. Instead, use good-quality Kashmiri chilli powder for colour, and reduce the chilli sauce to 1 tbsp. Add an extra ½ tsp sugar to balance the taste.

Can I use garlic powder instead of fresh garlic?

Yes. You can use ½ tsp of garlic powder instead of 1 tbsp of chopped garlic. Add it along with the sauces instead of frying it alone, because powdered spices burn quickly in hot oil. You can use both as well.

Can I make chili paneer in advance for a party?

Yes. You can fry the paneer and store it for up to 3 hours beforehand, at room temperature. Prepare the sauce and keep it in the pan. Warm the sauce before serving, turn off the gas, toss in the fried paneer, and serve.