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Mix together the curry powder, salt, pepper, and chile powder. Sprinkle over the diced chicken pieces in a mixing bowl and stir until everything is well-coated. Cover and place in the fridge for 1-2 hours.
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In a large skillet, heat the olive oil over medium heat, then add the onion and jalapeno and cook until soft, about 8-10 minutes, stirring occasionally to keep it from burning.
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Add the garlic, ginger and basil and cook for 30 seconds, stirring constantly. Add the chicken pieces, including any juices from the bottom of the bowl and cook until the chicken is almost cooked through, about 5 minutes.
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Pour a few tablespoons of the coconut milk into a small bowl and whisk with the cornstarch. Add the rest of the coconut milk to the skillet, scraping the bottom, until everything is well-combined. Add the coconut milk/cornstarch mixture, stirring constantly, and then let cook about 3-5 minutes until the sauce is thickened and the chicken is completely cooked through.
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Salt and pepper to taste and serve over rice.