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In a bowl, pour water over tamarind and let sit for 10 minutes to hydrate, then mix well and strain pulp, leaving seeds, creating tamarind juice.
In a saucepan, bring tamarind juice, balsamic vinegar, shallots, sugar, and garlic to a simmer and reduce to thicken to nappe consistency, about 20 to 35 minutes. Season to taste, strain, cool and refrigerate