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Optional - press tofu with some heavy object for 15 minutes. This will drain the excess moisture. Now cut the tofu into small cubes and set aside.
In a large bowl whisk together thickened coconut milk with coriander powder, garam masala, red chili powder, smoked paprika and salt until smooth. Stir in the tofu cubes and mix until all tofu pieces are coated with the marinade.
Cover and keep in the refrigerator for 30 minutes. Meanwhile do all the prep work - chop the onion, garlic, ginger and puree the tomatoes.
Press the saute button on your Instant Pot. Once it displays hot, add oil and then add the cinnamon stick. Saute for few seconds until fragrant.
Add the onion along with ginger and garlic. Cook for 4 minutes until the onions are soft and light brown in color. Then add in the tomato puree and mix.
Cover the pot with a glass lid and let the puree cook for 4 to 5 minutes.
Then add the curry powder, cumin powder, kashmiri red chili powder, salt and sugar. Mix to combine and cook the spices for one minute. Add the coconut milk and water and mix.
Stir in the marinated tofu. You may do the extra step of pan roasting the tofu on stove top before adding to the instant pot. This step is completely optional and I did not do it.
Close the Instant Pot with its lid. Press the manual or pressure cook button and cook on high pressure for 5 minutes. The pressure valve should be in the sealing position.
Do a quick pressure quick release. Open the pot, add chopped cilantro and mix.
Serve instant pot tofu tikka masala with rice or bread of choice!