In a mixing bowl add in the All-purpose flour and butter. Crumble it with the hands and it resembles sand.
Next, add in the Sugar and Milk. Mix well such that everything is evenly mixed.
Next break open the egg and beat well such that everything is creamed up together.
Next add in the Baking powder, Salt, and food color (if adding)and mix well.
Toast the Pistachios in the microwave for a minute and then in a blender powder them coarsely. Reserve 2 tbsp of pistachios and mix the remaining with the cake batter. Fold everything together.
Divide the batter equally into two portions and then bake them in two separate pans. Line the baking pan with parchment paper and then pour the prepared cake batter over the pan. I used two 8 inch round cake pans.
Preheat the oven at 356 F (180 Deg C) for about 10 min and then bake for about 25-30 mins until the toothpick when inserted comes out clean.
Prepare Cream Cheese Frosting
In a mixing bowl add in the cream cheese and soft butter. Cream them togther until light and fluffy with a hand blender or stand mixer. Scrape and remove them from the edges.
Add in ¼ tsp of Vanilla extract and then add in the sifted icing sugar in batches. Mix well after each batch. Cream cheese frosting is now ready.
Decorate the cake
Meanwhile, let the cake cool down completely. You can slice the cake into two or bake two similar cakes as you like and then frost.
Take the first cake and spread in a generous layer of cream cheese and sprinkle in some coarsely ground pistachios.
Place the next cake on the top and then repeat the same. I used some sprinkles and pistachios powder for decoration.
Notes
The baking time may vary so check after 20 mins.
Cool the cake completely and then chop them into pieces. Else it might crumble.
Adding food color is not good for health and hence it not advisable.