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Preheat oven to 170°C (150°C).Grease a deep 22cm round cake pan; line base and side with three layers of baking paper, extending the papers 5cm above the edge.
Blend or process 1 cup of the pistachios until finely ground. Coarsely chop remaining pistachios.
Beat butter, sugar and rind in a medium bowl with an electric mixer until light and creamy. Beat in eggs, one at a time. Stir in sifted flours, yoghurt and ground pistachios. Spread mixture into pan.
Bake cake for 1¼ hours or until a skewer inserted in the centre comes out clean. Cover with foil if overbrowning. Leave cake in pan for 5 minutes before turning, top-side up, onto a wire rack to cool.
Beat butter and rosewater in a medium bowl with an electric mixer until as white as possible. Gradually beat in sifted icing sugar until smooth. Add enough of the milk to make the butter cream a spreadable consistency.
Split cake in half. Place base cake layer, cut-side up, onto a cake plate; spread with one-third of the butter cream, then top with remaining cake layer. Spread remaining buttercream over top and side of cake. Decorate top of cake with chopped pistachios.