Shahi Paneer Recipe (Restaurant Style)

Shahi Paneer also known as Mughlai Paneer is a delicious Indian dish of soft, pillowy paneer served in a creamy, aromatic and rich restaurant style gravy. This dish made with Indian cottage cheese, simmered in an onion-nut paste, and enriched with yogurt and mild spices, is a throwback to the era of kings and royal kitchens.

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Mughlai Cuisine has given the world some culinary wonders and shahi dishes are one of them. Inspired from dishes like the Shahi Korma, Shahi Chicken and ghost, vegetarian versions with paneer and veggies have been derived. This Shahi Paneer is a refreshing change from all the hot Indian curries/sides and the mains. It is mild but luxurious like this Malai Paneer and isn’t hot or fiery.

So it is kids-friendly and is great when you want a break from all those tomato based curries like Paneer butter masala, Kadai Paneer or Paneer Makhani. Make this better than restaurant style Mughlai Shahi Paneer under 45 mins.

About Shahi Paneer

Shahi Paneer is a vegetarian Mughlai style curry where paneer is cooked in a creamy sauce made with onions, yogurt, nut and seeds. As the name says, Shahi Paneer literally means “Paneer for the Royalty”. So it is cooked with ingredients that impart a richness to the dish like ghee, yogurt, cream, nuts and seeds.

This is one of the few vegetarian dishes you’ll find only in the restaurants serving traditional Mughlai foods. Mughlai Cuisine was developed during the reign of the Mughals in India by the Khansaamas (chefs serving in the royal kitchens).

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This cuisine is based on Persian and central Asian cuisines with distinct Indian influences. Few things that set apart Mughlai dishes from other foods is the rich and creamy texture, complex flavors, use of whole spices, fragrances in the form of rose and kewra water, and most importantly, the technique of slow cooking.

These dishes are predominately meat based with culinary creations like Akbari dal (made with urad dal and yogurt) and Shahi Paneer being some of the exceptions. This cuisine developed centuries ago, has changed Indian attitudes towards foods and has introduced us to new flavors and food combinations.

Shahi Paneer is made in two ways – the old-style without tomatoes (as tomatoes were introduced much later in India by the Portuguese and British colonists) and the modern restaurant style with tomatoes which comes closer or tastes same as Punjabi Paneer Butter Masala.

My Recipe

This recipe is made in the Mughlai style and does not require tomatoes. I have specified a lot of spices as optional and these work on the color and heat levels. Most Mughlai gravies are white in color and since my family does not like white curries, I have add a little turmeric and red chili powder.

But if you want your dish to be white or off-white, feel free to omit both the spices and add more black pepper or green chilies for heat.

This Shahi Paneer can easily impress your family or friends and this is a great dish to serve for a luncheon or dinner party. It has all the elements of an enticing side. It is really an indulgence, befit for weekends and those days when you want to serve and eat something special.

Mughlai Paneer tastes delicious even with plain steamed basmati and for special occasions you may serve it with flavored rice like turmeric rice, Saffron Rice or flatbreads like Butter Naan, Tandoori Roti, Plain Parathas or Kulcha.

More Paneer Recipes
Dhaba Style Paneer Curry
Palak Paneer
Malai Kofta
Paneer Lababdar

Photo Guide

How to make Shahi Paneer (Stepwise Photos)

This recipe has been upgraded recently for a higher amount of sauce and ease of making. Kindly ignore the ingredient quantities in the pictures. I have the previous version of this recipe at the bottom of the page, after the stepwise photos. I haven’t changed much except for the amount of onions (1.5 cups from 1 cup), little ginger garlic and adding 2 extra almonds.

Make Shahi Paste

If you do not have a powerful blender, omit step 1 (next para) & follow this. Soak 12 cashew nuts (23 grams), 10 almonds (12 grams) and 2 to 3 green cardamoms in half cup hot boiling water for 20 mins. Later drain and add them at step 2.

1. Heat 1 tablespoon ghee or oil in a pan and add 10 almonds, 12 whole cashews and 2 to 3 green cardamoms. Fry for 2 to 3 mins until golden.

2. Add the following ingredients –

• 1½ cup (170 grams) yellow or white onions diced or sliced (2 medium, avoid purple onions)
• 1 inch ginger peeled and sliced – 8 grams (or use 1½ teaspoon ginger garlic paste later after sauteing the onions)
• 4 large garlic cloves – 12 grams (omit if using ginger garlic paste)
• 1 slit green chili (optional, I don’t use for low heat)

3. Saute for 5 to 6 mins, until transparent. Pour 3 to 4 tablespoons water to deglaze. Cook until soft and mushy for another 3 to 4 mins. If you prefer a tomato based dish, optionally add 1 to 2 diced tomatoes and saute until they break down. I don’t use them.

4. Remove & discard the green chili for a low heat option. Cool down the sautéed ingredients, and add to a blender along with 1/3 cup cold water.

5. Grind/blend to a smooth puree. Your shahi paste is ready. If your blender can’t grind well, add little more water.

Make Shahi Paneer

6. On a medium flame, heat the same pan with 2 tablespoons ghee or oil. Add the following optional whole spices

• 1 small bay leaf (Indian tej patta)
• 2 inch cinnamon piece
• ½ teaspoon shahi jeera (Indian caraway seeds or substitute cumin seeds)
• 2 cloves

7. When they begin to sizzle (under 30 seconds), transfer the shahi paste and the following –

• ¼ to ½ teaspoon Kashmiri red chili powder (optional, use to color & heat preference, omit for a white gravy)
• ¼ teaspoon turmeric (optional, omit for a white gravy)
• ½ teaspoon salt (adjust to taste)
• ¾ to 1 teaspoon garam masala (adjust to taste preference)

8. Saute for 3 to 4 minutes until the sauce begins to smell good.

9. Add half cup thick yogurt (130 grams) to a bowl and whisk it well with a fork. Transfer 1 to 2 tablespoon of the cooked sauce to the yogurt and whisk well to a uniform smooth mixture. Reduce the heat to low and transfer the yogurt to the pan in 2 batches, mixing between each addition. (If you are confident the yogurt won’t split, you may add it directly to the pan like I did here.)

10. Saute for another 3 to 4 mins.

11. Pour 3/4 to 1 cup water and mix well. (Pic shows saffron here but add it later after turning off the heat. That gives a better saffron flavor.)

12. Bring to a gentle boil on a medium heat and cook covered until thick, creamy and traces of fats are visible on the top. It takes me about 10 mins, but may be different for you. But cooking the sauce longer, makes the sauce tastier.

13. The sauce thickens further upon cooling, so don’t make it too thick. Taste test to add more salt and ⅛ to ¼ teaspoon ground black pepper (I opted to add a slit green chili here). If you want you may remove all the whole spices (except jeera) at this stage. Add paneer and cook for a minute. Turn off and stir in 3 tablespoons heavy cream (which I omitted). Sprinkle a pinch of saffron & 1 teaspoon rose water or 2 to 3 drops of kewra if you want. (I don’t use rose or kewra often). Turn off and rest covered for at least 5 to 7 mins before serving.

Shahi Paneer goes well with Saffron rice, Turmeric rice, Jeera rice, plain basmati, roti, naan or plain parathas.

Expert Tips

• If you want you can also add a tablespoon of raisins , about 12 grams along with the onions. They impart a natural sweet and tart flavors.
• Mughlai gravies are usually made with boiled onion and nut paste. If you want you may boil all of the ingredients instead of sautéing but all kinds of onions don’t go well for boiled onion paste. So I prefer to saute which also helps to bring out a sweet flavor of the onions.
• Use freshly made curd or yogurt as store bought curds tend to be sour.
• Use fresh and good quality paneer as it makes a lot of difference to the texture and taste of your gravy.
• Don’t skimp on the gram masala or the whole spices. As we’re using less spices, you need to make sure the gravy tastes good.
• Skip the red chili powder if you want to retain the creamy white color and mild flavor of the shahi paneer. Use the green chili instead.
• Don’t cook the paneer for more than 2 to 3 minutes unless you want a rubbery and chewy paneer. If you’ve fried the paneer earlier, add it and immediately remove from heat.
• I have used a mix of cashews and almonds. You can make this with all cashews, if preferred. Or use poppy seeds, melon seeds or a mix of nuts and seeds.
• Add cashew cream or coconut yogurt and tofu to make this vegan.

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Shahi Paneer Recipe first published in August 2014. It has been updated and republished in December 2024.