In a small bowl stir together the water, yeast and ½ tsp sugar and leave to foam for 5 minutes
Combine the flour, salt and remaining sugar in a bowl
Add the yeast mixture, milk, butter and egg and mix well until a soft dough
On a floured surface knead the dough until smooth
Transfer dough into an oiled bowl, cover and let rise for 1 hour or until doubled in volume
Turn dough onto floured surface, roll and cut out doughnuts
Let doughnuts rest for 30 minutes then place in the air fryer 160°c for 6 minutes
Mix the water and icing sugar together then pour over cooled doughnuts
Serve immediately