Marinate the chicken pieces with turmeric powder and 0.5 tsp salt for 15 minutes.
Heat cooking oil in a wok or large pan over medium-high heat. Fry the marinated chicken until lightly browned, about 10-14 minutes total. Remove chicken and set aside, reserving some oil.
While chicken is frying, prepare the chili paste. Blend dried chilies, shallots, garlic, and ginger with a little water until smooth. Bruise lemongrass.
Using the reserved oil, sauté the blended chili paste and bruised lemongrass over medium heat. Stir constantly until the paste is fragrant and the oil separates ("pecah minyak"), about 8-10 minutes.
Add tomato paste, sugar, and the remaining salt. Stir well and cook for another 2-3 minutes.
Return the fried chicken to the pan. Add tamarind paste (mixed with water) and coconut milk. Stir to coat the chicken with the sauce.
Bring the sauce to a simmer, then reduce heat to low, cover the pan, and let it simmer for 15-20 minutes, or until the chicken is tender and the sauce has thickened to your desired consistency. Stir occasionally to prevent sticking.
Stir in sliced onion and green chilies during the last 5 minutes of cooking. Garnish with fresh coriander leaves before serving. Serve hot with rice.
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