The firm said research is one of the first steps towards ensuring food safety.
It will be supporting the university in a study which will examine the effects of mycotoxins on the health and milk yielding capacity of animals and how mycotoxin levels in milk can be reduced.
"We are committed to sharing our knowledge on food safety with anyone who needs it to facilitate delivering safe products to all," said Naveed Ahmad Khan, the head of technical for Nestlé Pakistan.
Mycotoxins are toxins produced in cattle feed by species of fungi due to improper storage and handling. Animals that consume such feed become sick, unproductive and experience reduction in fertility. The toxin is passed on into the milk they produce and cannot be removed.
Prof Dr Tallat Naseer Pasha, vice chancellor of UVAS, said: "I appreciate the continuous efforts and financial support of a global food company like Nestlé for student scholarships, student internships, applied research and other areas.
“I am happy that Nestlé and UVAS are joining hands for another project that will help the country move towards a safe milk value chain."