Serve this chutney alongside our Rava Dosa.
Process coconut, chiles, ginger, garlic, and salt in a food processor or blender, gradually adding 1/2 to 3/4 cup water until a thick paste forms.
Heat oil in a medium skillet over medium heat. Add mustard seeds; cover. Cook until seeds pop, 30 to 45 seconds. Add shallot and urad dal (if desired); cook, stirring, until softened, 2 to 3 minutes.
Stir together shallot mixture, coconut mixture, yogurt, cilantro, and lime juice.