Bring water to boil in a large saucepan. Dissolve bouillon in boiling water. Remove 1 cup of this broth and mix with cornstarch in a small bowl. Return broth and cornstarch mixture to saucepan and let thicken. Stir in sugar, oyster sauce, and soy sauce. Remove from heat and set aside.
In a shallow dish or bowl, flour cubed chicken and allow to stand in flour for 15 minutes. In a small bowl, beat egg, milk, salt and pepper together. Remove chicken from flour, dip into egg mixture, roll in flour again and fry in in hot peanut oil in a large skillet until golden brown.
Place fried chicken cubes over hot steamed rice on a medium platter. Heat sauce over low heat, then pour over chicken. Sprinkle with cashew halves and green onions and serve.