Whisk the flour, baking powder, salt, and pepper together in a bowl. Whisk together the egg and milk in a separate bowl; stir in the flour mixture until a smooth dough is formed.

Fill a large pot with lightly salted water and bring to a rolling boil over high heat. Once the water is boiling, cut the dough into bite sized pieces with scissors into the boiling water. Boil for 20 minutes; drain well.

Heat the oil in a large skillet over medium-low heat; add the knefla and potatoes. Stirring occasionally, cook until the potatoes are tender and the knefla are golden brown, about 20 minutes.