Begin by dicing the potatoes into uniform, bite-sized pieces for even cooking.
In a large, heavy-bottomed pan, heat 2 tablespoons of oil over medium heat.
Add the finely diced onion and minced garlic to the pan, sautéing for 2-3 minutes until fragrant.
Sprinkle in the caraway seeds and continue to cook until the onion turns translucent.
Add the sliced sausage to the pan, allowing it to brown slightly for about 2 minutes.
Toss in the red pepper and prepared potatoes, stirring to combine.
Sprinkle the paprika and smoked paprika over the mixture, then add the tomato paste. Stir quickly to incorporate.
Immediately pour in two cups of water to cover the potatoes, preventing the paprika from burning.
Add the bay leaves.
Cover the pan with a lid and let the dish simmer for approximately 20 minutes, or until the potatoes are tender when pierced with a fork.
Serve hot, garnished with a generous sprinkle of fresh chopped dill. For a more authentic Romanian taste, add sour cream and pickles on the side.