In a mortar and pestle, pound together until fine the following ingredients in the order stated - lemon grass, galangal, garlic, shallots, chillies and peppercorns. Add ground spices and shrimp paste, and mix well together into the paste. Alternatively, put all spices into a food processor and process into a fine paste.
Heat up oil in a deep pot set over low medium fire. When hot, fry spice paste until fragrant and oil floats to the surface, about 5 minutes. Increase fire to medium, add chicken chunks and stir fry to coat the pieces all over with the spice paste.
When chicken chunks start to turn colour and is slightly cooked on the outside (about 5 minutes), add thin coconut milk and kaffir lime leaves. Let mixture come to a boil, then let simmer for 20 minutes.
Add seasonings (when adding fish sauce, add tbsp by tbsp, as it is salty, until flavour is to your taste) and basil leaves. Drizzle in thick coconut milk, stir to mix well and bring back to a gentle boil. Immediately remove from fire once it comes back to a boil, and serve hot.(Note: Do not let coconut milk boil too long as the oil will start to separate, resulting in a curdled appearance)