Prepare the Cashew Paste: In a small bowl, soak the cashews in ½ cup / 120 ml (4.1 fl oz) of boiling water for at least 10 minutes.
Once softened, transfer the cashews and their soaking water to a blender.
Blend until you have a completely smooth, fine paste.
Set aside.
Prepare the Spices & Potatoes: While the cashews are soaking, use a pestle and mortar to crush the fennel seeds into a fine powder. Wash the baby potatoes and pat them dry.
Keep the smallest ones whole and halve or quarter any larger ones to ensure they are all a uniform size.
Fry the Potatoes: Heat 2 tablespoons / 30 ml (1 fl oz) of the oil in a large, lidded frying pan or skillet over medium-high heat.
Add the potatoes and fry for about 8 minutes, stirring occasionally, until they are lightly browned and have a slight crust.
Remove the potatoes from the pan and set them on a plate.
Build the Gravy Base: In the same pan, add the remaining 2 tablespoons / 30 ml (1 fl oz) of oil over medium heat.
Once hot, add the sliced onion and sauté for 10 minutes until soft, translucent, and golden.
Add the crushed garlic and grated ginger, cooking for another 2 minutes until fragrant.
Create the Masala: Stir in the canned plum tomatoes, breaking them up with your spoon.
Cook for 5-8 minutes, allowing the sauce to thicken and reduce.
Add the crushed fennel seeds, garam masala, ground red chile, and salt.
Stir well to combine all the spices.
Thicken and Simmer: Pour the prepared cashew paste into the pan and cook for 2 minutes, stirring constantly. Gradually stir in 1½ cups / 360 ml (12.2 fl oz) of water to form a smooth gravy.
Finish the Dum Aloo: Return the fried potatoes to the pan, stirring gently to coat them in the gravy.
Bring to a simmer, then reduce the heat to low.
Cover the pan with a lid and cook for 10-15 minutes, or until the potatoes are completely tender. Test by inserting a knife; it should slide through with no resistance.
Serve: Serve your delicious Punjabi Dum Aloo hot with fresh parathas, fluffy basmati rice, a side of moong dal, and your favorite pickles.