Rinse the basmati rice 3-4 times in cold water until the water runs mostly clear. Soak the rice in 2 cups of fresh cold water for 20-30 minutes, then drain thoroughly through a fine mesh strainer.
Gather and prep all whole spices: bay leaf, cloves, cardamom pods, and cinnamon stick. If using green chili, finely chop it. Measure out cumin seeds and chop cilantro for garnish.
Heat a heavy-bottomed saucepan over medium heat. Add ghee and allow it to melt completely until shimmering but not smoking. Add cumin seeds and bloom for 20-30 seconds until dark and fragrant. Add remaining whole spices and chili, sauté for another 20-30 seconds.
Add the drained soaked rice to the pan and gently stir to coat every grain with spiced ghee. Toast the rice over medium heat for 1-2 minutes until grains become slightly translucent around the edges.
Pour in 2 cups of water over the toasted rice and spices. Add salt and stir gently to combine. Increase heat to high and bring the water to a full rolling boil, about 2-3 minutes.
Once boiling, immediately reduce heat to the lowest setting, cover with a tight-fitting lid, and cook for 12-15 minutes without lifting the lid.
Turn off the heat and keep the lid on. Let the rice rest for 5 minutes. Remove the lid, gently fluff the rice with a fork, remove whole spices, garnish with fresh cilantro, and serve immediately.