Butter Paneer Curry – Spicy Sri Lankan Recipe

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What is Paneer and how does Paneer taste like?

Paneer is a non-aged, non-melting Indian cheese made from curdled milk. It has a milky and mild flavor, similar to cottage cheese. However, it has very low saturated fat compared to other cheeses. Paneer is a great ingredient to use in plant-based cooking, and is normally cooked with spices, either in stir fries or spicy curries. In the US, it can be easily found in the refrigerator section of any Indian store. The most famous Indian paneer dishes are Saag Paneer and palak paneer, which is paneer cooked in a curry of spinach or other greens. It is also found in big supermarket chains like Target, Kroger and Sprouts.

How to Prepare Paneer for Cooking

Cut out the packaging off the paneer and cut into bite-sized blocks.

How to Cook a Sri Lankan Paneer Curry
(the Short Version)

Heat a pan with oil (coconut or vegetable), and add chopped onions, chopped garlic cloves, and thinly sliced green chilli. Once the onions are browned, then add the tomatoes and cook until they are mushy. Then add the blocks of paneer, along with coconut milk and spices. Cook on medium heat until paneer is soft. See my recipe, and step by step instructions below to make an easy home-cooked paneer curry.

Reasons to Try to this Easy Sri Lankan Paneer Curry

1) Tastes like a restaurant curry, but spicier and healthier!

2) Paneer has low saturated fats compared to other cheese.

3) Craving some cheesy, spicy comfort food? This is it!

What Ingredients do you need to cook this delicious
Sri Lankan Paneer Curry?

To cook this easy paneer curry, you need the following ingredients (including curry spices) :

  • Paneer- One block of Paneer, about 8 ounces (I prefer the Gopi brand)
  • Olive oil (or other cooking oil)
  • Butter – I use Kerrygold
  • Red Onion
  • Garlic cloves
  • Green Chillies
  • Tomatoes
  • Coconut milk (using Goya brand)
  • Turmeric powder
  • Red Chilli powder
  • Roasted curry powder (substitute with garam masala)
  • Mustard seeds
  • Dried Chillies
  • One bay leaf (optional)
  • Cinnamon stick (optional)
  • Curry leaves (optional)

 

Tips and Tricks to Cook this Perfect Paneer Butter Masala

  • Chop paneer into bite-sized cubes (about 1 inch). If the paneer cubes are too big, they will not properly absorb all the curry flavors.
  • Use homemade paneer for the best tasting paneer curry
  • I use canned coconut cream ( thick coconut milk) in this recipe, but you can use either coconut cream or coconut milk. Coconut cream can be used without diluting to get a thicker curry, or cooked with some water according to your preference. Coconut milk can be found in the dairy section of supermarkets. It is usually diluted, so never add water to the curry if you use coconut milk
  • Adding the butter to the curry increases the depth of flavor. Do not skip it unless you really need to! Also, add it to the pan together with the cooking oil. This will prevent the butter from being burnt. 
  • The ingredients used are very similar to an Indian Paneer Curry. The flavors will differ slightly due to using Sri Lankan roasted curry powder, and the method of cooking paneer. 
  • Even though fresh tomatoes can be substituted with tomato paste to add some flavor, the curry sauce texture will change.
  • Use garam masala or any curry powder of your choice. Here is my recipe for homemade roasted Sri Lankan curry powder. 

Sri Lankan food to Serve with this Spicy Paneer Curry

In Sri Lankan cooking, any spicy curry is generally served with a non-spicy or sweet curry to balance out the flavor. This spicy paneer curry can be served with a lot of Sri Lankan dishes such as:

  • Mild Dhal Curry – The most delicious vegan side dish to serve with ANY curry, rice, naan, or bread. 
  • Mallum/Sambola – Any side dishes cooked with using shredded coconut will pair well with this vegan curry. Try these cabbage leaf mallum, gotu kola mallum or pol sambola dishes. These side dishes are also vegan and will pair well to create a healthy, delicious meal.
  • Hot White Rice / Bread / Naan / Tortillas
  • Fried potatoes – My personal favorite! For some reason, white rice served with fried potatoes pair so well with this spicy paneer curry. This is my second favorite comfort meal (first being my spicy, creamy sri lankan dhal curry)

Paneer curry - Spicy Sri Lankan style

Servings 4
Prep Time 10 minutes
Cook Time 25 minutes
Total Time 35 minutes

Ingredients

  • 1/2 lb Paneer Gopi brand used here
  • 1/2 Red Onion
  • 1 cup Cherry tomatoes or 2-3 small tomatoes
  • 1 Green chillie or 1/2 jalapeno
  • 2 Garlic cloves
  • 1 cup Coconut milk
  • 1 tbsp Olive oil

Seasoning

  • 10 Dry Chillies
  • 1 tbsp Mustard seeds
  • 1 tbsp Salt
  • 1 tbsp Chillie powder
  • 1 tbsp Curry powder, roasted
  • 1/2 tsp Turmeric

Instructions

  • Add 1 tbsp of olive oil, 2 tbsp of butter and heat in a pan
  • Chop onions, garlic, green chillies and paneer cubes
  • Fry onions, garlic and chillies for 5 minutes
  • Add dried chillies and mustard seeds, and cook for 1-2 minutes until mustard seeds pop
  • Add the cherry tomatoes and cook for 5 minutes
  • Add cubed paneer, spices, and coconut milk
  • Close lid and cook on a low flame for 10 minutes
  • Open lid, and cook for 10-15 minutes until paneer is soft
Cost: $7
Course: dinner, lunch
Cuisine: Indian, sri lankan
Keyword: spicy paneer dry curry recipe

Steps in this Sri Lankan Paneer Curry Recipe (with pictures)

Chop the onions, garlic cloves, green chili and curry leaves (if available). Heat a pan with one tbsp of oil (olive oil / coconut / vegetable) and two tablespoons of butter. 

Add the chopped onions, garlic and green chilies. Cook for 2-3 minutes until onions are browned.

Add the mustard seeds and dried red chillies. Cook for 2-3 minute until mustard seeds start popping (They will fly off the pan). 

Add the cherry tomatoes (or chopped tomatoes) and cook for about 5 minutes until the tomatoes are soft

 

chopped vegetables and cherry tomatoes in a pan

Add the cubed paneer to the pan

tomatoes and paneer cubes in a pan

Add all the spices (red chili powder, turmeric powder, roasted curry powder) 

tomatoes and paneer cubes in a pan with spices

Add the coconut milk to the pan

tomatoes and paneer cubes in a coconut milk curry with spices

Close lid and cook on low heat until paneer has a softer texture. Open lid and cook on high heat for 5 more minutes if you would like the curry to thicken. Curry is ready to serve!

paneer curry with tomatoes and dry chillies on a pan

If curry is cooked for longer, it will thicken like this.

dry paneer curry on a white dish

Spicy Sri Lankan Paneer Curry is served with yellow rice and sliced onions and green chili here. Enjoy!

Yellow rice surrounded by paneer curry and onion slices on a white plate

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