An Asian inspired twist on the timeless Indian classic, this coconut gravy paneer is a harmonious blend of coconut milk and tomatoes, all at once. The creamy pieces of paneer soak up all of the goodness and are packed full with flavor.
The magic all starts in the Instant Pot with a classic paneer gravy with tomatoes, onions and spices. Once that’s ready, we introduce the coconut milk, which makes for a lovely combo. It also has vegetables like baby corn, bell peppers, and onions for a great freshness. The tartness of the tomatoes, the spice of the chili, and the floral flavor of the coconut is the most delicious mix! Serve it to you family, friends, and guests, and leave them hungry for more!
If you like this recipe, make sure to check out my other Instant Pot dishes:
- Instant Pot Palak Methi Chana Dal – Spinach Fenugreek Lentil Stew
- Instant Pot Kolkata Ghugni Chaat – Indian Street Food
- Saffron Rose Biryani – Instant Pot or Stovetop
- Nepali Kwati Daal (Mixed Lentil Stew) – Instant Pot or Stovetop
- Instant Pot Aloo Matar
STEP BY STEP VIDEO:

Instant Pot Paneer Coconut Masala - an Asian inspired twist on the timeless Indian classic, this paneer in coconut gravy is a harmonious blend of coconut milk and tomato, all at once. The crisp bell peppers, baby corn, and onions give it a lovely freshness and make it the perfect curry dish! Enjoy this with paratha, naan bread or rice!
- 1 medium onion , chopped
- 3 tomatoes , finely chopped
- 1/2 inch ginger , minced
- 1 tsp garlic , minced
- 1 tsp green chili , finely chopped
- 2 cups paneer , diced
- 2 tbsp oil
- 1/4 cup tomato puree
- 1 tbsp butter
- 2 tbsp cashewnut paste
- 1/4 cup coconut milk
- 1/2 tsp all purpose flour , mix into coconut milk
- 1 tbsp tomato ketchup
- 1 tsp honey
- salt to taste
- 1/2 cinnamon stick
- 1/2 tsp cumin seeds
- 1/2 tsp turmeric powder
- 1 1/2 tsp red chilli powder
- 1/4 cup water
- 1 1/2 tsp coriander powder
- 1 tsp kasoori methi
- 1/2 tsp garam masala
- 1/4 cup red, green, orange peppers , diced
- 1/4 cup baby corn , chopped
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Switch the Instant Pot on sauté mode. Add oil, butter, cumin seeds, cinnamon stick, ginger, garlic and green chilies. Sauté for 1 minute.
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Add onions and sauté for 4-5 minutes till onions are translucent.
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Add cashew nut paste.
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Mix the coconut milk and flour so it doesn’t split. Put it in and sauté for 2 more minutes.
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Add chopped tomatoes, tomato purée, tomato ketchup, turmeric powder, red chili powder, coriander powder, kasoori methi and salt.
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Add in the water and mix everything together.
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Put the lid back on and cook on high pressure for 5 minutes. Make sure it is in the sealed position.
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Release the pressure with a towel, open the Instant Pot, and put it in sauté mode.
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Add in honey and garam masala. Also add in the paneer, baby corn, and bell peppers. Cover and saute it for a few more minutes, till the oil separates.
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Paneer Coconut Masala is ready! Enjoy it with roti, parantha, naan bread or rice.
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Follow steps 1-6 from above in a saucepan over medium heat. Cover it and cook for 7-8 minutes till the oil separates. Make sure to keep stirring in between so that the curry doesn't stick to the pan.
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Add in honey and garam masala. Also add in the paneer, baby corn, and bell peppers. Cover and cook on medium heat for 2 more minutes. Paneer Coconut Masala is ready!
Recipe Video
- You can use ginger-garlic-chili paste in the recipe
- For stovetop recipe, you can add 1/4 cup extra water if the curry looks too dry.
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Looked the addition of coconut milk.
Superdelicious paneer recipe….Addition of coconut milk leads to another enriched level…..a must try recipe ..
Looks delicious…A must try recepie.
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This is a gorgeous recipe. I tried this and it turned out to be outstanding … Loved every bite of it..
Thank you so much!! So happy to know that you liked it 😁
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loved it and so did the kids