Combine lamb, ginger, cumin, ground cloves, ground cinnamon, nutmeg, black pepper, cayenne, salt and 3 tablespoons of the yogurt in a large bowl. Mix well. Wet hands and shape mixture into approximately 24 koftas, 2-3 inches long and 1-inch thick.
Heat oil in a large, heavy-bottomed (or cast iron) skillet. When hot, add whole spices: cinnamon stick, cardamom pods, whole cloves and bay leaves. Stir.
Add meatballs in a single layer and fry on medium-high heat until lightly browned on all sides. Beat remaining yogurt and warm water. Pour yogurt-water mixture over the meatballs and bring to a boil. Cover, reduce heat and simmer for 30 minutes, turning the meatballs every 8 minutes.
After a half hour, all of the liquid should have evaporated, leaving only grease in the pan. If necessary, turn the heat up to evaporate the yogurt-water mixture.
Remove koftas with a slotted spoon, leaving the whole spices behind. Serve with basmati rice.