Rinse sabudana under water until the water turns clear. This is important to get rid of all the starch. Transfer the rinsed sabudana to a large bowl and add 1 cup of water to it. No more. In the morning the sabudana would have soaked up all the water. But you still drain it using a colander just to get rid of any excess water. To check if sabudana is ready to cook, press a pearl between your thumb and index finger. It should smash easily. Set it aside.

Heat oil in a pan on medium heat. Once the oil is hot, add the cumin seeds and let them sizzle for a few seconds.
Then add the diced potatoes and cook for 3-4 minutes stirring often until potatoes are almost cooked. It's important to dice the potatoes small here so that cook quickly. Add the raw peanuts for another 2-3 minutes. Then add the green chili, and curry leaves and cook for 1 more minute.

Add the drained sabudana to the pan along with salt and sugar. Mix until well combined. Cook for a few minutes until most of the sabudana pearls become translucent, stirring once or twice. Do not cook it for a long time else it will become sticky. Remove pan from heat. Add lemon juice and cilantro and toss to combine.
Serve sabudana khichdi hot with chilled yogurt.