Heat the oil in a pan, and add the grated coconut and fry it until it turns golden brown colour. Keep this aside.
Heat some oil in the pan, and add the mustard seeds when the oil is hot. When the mustard seeds, starts to sputter add the red chillies along with the dal, hing and fry it till the dal turns into golden brown colour.
Add the fried grated coconut along with fried dals, tamarind and salt to a mixer and grind it to fine powder.
The Thengai Milagai Podi is ready to serve with hot idlis and dosas.