Heat the water and sugar in a small clay pot or saucepan over medium heat. Let the sugar caramelize, it should get a golden brown color. Next, add the minced shallot and green onions and cook for one more minute.
Next, deglaze with the water. Add the vegan fish sauce, sweet chili sauce, soy sauce, ground black pepper, and stir to combine.
Add the fried tofu and halved mushrooms and bring to a simmer. Let simmer covered for 7-10 minutes. The tofu and mushrooms will soak up the sauce, making them sweet and salty. Taste and adjust seasonings if needed, adding more vegan fish sauce for saltiness, or water to dilute if too salty.
Serve immediately on top of steaming white rice! This braised tofu and mushroom clay pot will keep for up to two days in the fridge. It tastes even better the next day as the tofu soaked up more flavors.