Shahi Paneer Recipe (Mughlai Paneer)

Shahi Paneer also known as Mughlai Paneer is a succulent Indian dish of soft, pillowy paneer floating in a creamy 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. Make this delicious restaurant style Mughlai Shahi Paneer under 35 mins. Serve it with Butter Naan, Plain Basmati rice, Jeera Rice, roti or Plain Paratha.

Mughlai Cuisine has given the world some culinary wonders and Shahi Paneer is no exception. This dish is a creamy blend of textures and is not very hot or fiery like this Kadai Paneer.

Like Paneer Butter Masala and Paneer Makhani, this is one of those mild vegetarian curry that is a refreshing change from all the spice and heat of other sides and mains.

If you’re searching for a recipe to impress family and friends for a luncheon or dinner party, this dish has all the elements of an enticing side. This is really an indulgence befit for weekends and those days when you want to serve and eat something special.

About Shahi Paneer

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

This is one of the few vegetarian recipes you’ll find in the traditional Mughlai Cuisine other than desserts which brings us to a popular and rich regional cuisine made popular by restaurants across India.

Mughlai Cuisine was developed during the reign of the Mughals in India by the Khansaamas (chefs serving in the royal kitchens). This cuisine is based on Persian and central Asian cuisines with distinct Indian influences.

Few things set apart Mughlai dishes from other foods. The rich and creamy texture, complex flavors, use of whole spices, meal 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 these were introduced much later in India by the Portuguese and British colonists) and the modern restaurant style with tomatoes which comes closer to this Paneer Butter Masala.

My Recipe

This recipe is made the customary way of cooking spices in an onion and nut-based gravy. Yogurt and mild spices add the tang. Cashews, almonds and yogurt add richness to this delicious dish. The resultant gravy is a well-balanced spicy, creamy and slightly tangy dish. While saffron give it a unique taste, kewra provides an appetizing aroma.

While this recipe has a big list of ingredients, don’t be intimidated by it. It is quick simple and easy to make. And uses everyday ingredient found in most Indian or vegetarian kitchens.

While the popular dish served in Indian restaurants contain tomatoes, this one is inspired by the classic shahi paneer. My recipe doesn’t contain any vegetables except onions. Although I have added instruction for using tomatoes. Feel freely to add peas, carrot, potatoes or corn (any vegetable on the sweeter side) if you want a change.

It is can be made with cashews alone but I have used a mix of cashew and almonds here. You can also use melon seeds or poppy seeds along with nuts. Cook this whenever you want a rich and mild dish to go with your roti, paratha, biryani, veg pulao or flavored rice.

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

How to make Shahi Paneer (Stepwise photos)

Prepare the Ingredients

1. If you’re using store bought paneer, soak it in warm water for 15 to 20 minutes and pat dry. You can optionally fry the paneer pieces in a little oil or ghee if you like. Put the fried paneer cubes in hot water for about 15 mins to soften them.

Make the Onion-nut Paste

2. Heat one tablespoon of ghee in a saucepan on medium. Add 12 whole or split cashews, 8 almonds and 2 to 3 green cardamoms. Shallow fry them for 1 to 2 mins, and be careful not to burn them.

3. Add 1 cup of cubed onions and 1 slit green chilli. Sauté until the onions turn transparent. If you prefer hot and spicy shahi paneer, use green chili at this stage. If you prefer a tomato based dish then add the optional cubed tomatoes (1 or 2) if using.

4. Cook the onion and nut mixture until the onions turn soft. Add a little water or oil if the mixture sticks to the pan. Remove from heat and cool completely. Transfer all the ingredients to a grinder jar.

5. Blend this mixture with minimal water to make a smooth and thick paste. Do not add a lot of water as we don’t want a runny paste. We don’t want any coarse nuts in the paste so make sure it is as smooth as possible.

Cook the Shahi Paneer

6. Heat the remaining 1 tablespoon of oil or ghee in the same pan. Add ½ teaspoon of cumin (jeera) or shahi jeera, 2 to 3 cloves and 1 to 2-inch cinnamon to the oil. On a low heat, sauté the whole spices for one minute until they turn fragrant.

7. Now add 1 teaspoon ginger garlic paste and sauté it well for 1 to 2 minutes, until the raw smell goes off.

8. Next add the onion-nut paste along with these:
¼ teaspoon of red chili powder
¾ to 1 teaspoon garam masala
⅛ teaspoon turmeric (optional)
½ teaspoon salt (adjust to taste)

9. Stir well to combine and cook for 3 to 4 minutes, until the raw smell of the spices goes away. The mixture turns thick as you cook. In the meantime, beat ½ cup of thick curd/plain yogurt in a bowl with a fork or whisk until creamy and smooth. Lower the heat to low and slowly add the beaten curd.

Tip: To avoid the yogurt from splitting you can also add a few tablespoons of cooked onion nut masala to the bowl of yogurt. Mix well to combine and then add it to the pan. This way the yogurt won’t split.

10. Let the shahi paneer gravy cook until it becomes thick and starts to leave the sides of the pan.

11. Add ½ to ¾ cup of water. Add the pinch of saffron strands, if you’re using it. Mix well add more water if required to make a runny gravy.

12. Cook the shahi paneer gravy until it thickens or the gravy releases oil or ghee on the surface. Taste test the gravy and add more salt or spices, if desired. For a mild heat, I add a slit green chilli at this stage instead of adding it with the onions.

When your gravy is perfect in consistency and texture, add 1½ cups of cubed paneer (around 225 to 250 grams). Cook on low heat for about 1 to 2 minutes. If using fried paneer don’t cook any longer. Turn off the heat.

Drizzle 2 to 4 drops of the optional kewra water and 3 tablespoons of cream. Stir well to combine. Immediately transfer shahi paneer to a serving bowl to stop it from cooking further. Garnish shahi paneer with cream. You can also sprinkle some crushed pepper for extra heat. I garnished it with some fresh mint leaves.

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Pro Tips

• 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 zest of the shahi paneer. Use the green chili instead.
• Don’t cook the paneer for more than 2=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. Updated and republished in 2021.