Add README for nodelocaldns

cluster/addons/dns/nodelocaldns/README.md

@@ -0,0 +1,35 @@
+# Nodelocal DNS Cache
+
+This addon runs a node-local-dns pod on all cluster nodes. The pod runs CoreDNS as the dns cache. It runs with `hostNetwork:True` and creates a dedicated dummy interface with a link local ip(169.254.20.10/32 by default) to listen for DNS queries. The cache instances connect to clusterDNS in case of cache misses.
+
+Design details [here](https://github.com/kubernetes/community/blob/master/keps/sig-network/0030-nodelocal-dns-cache.md)
+
+## nodelocaldns addon template
+
+This directory contains the addon config yaml - `nodelocaldns.yaml` 
+The variables will be substituted by the configure scripts when the yaml is copied into master.
+
+### Network policy and DNS connectivity
+
+When running nodelocaldns addon on clusters using network policy, additional rules might be required to enable dns connectivity.
+Using a namespace selector for dns egress traffic as shown [here](https://docs.projectcalico.org/v2.6/getting-started/kubernetes/tutorials/advanced-policy)
+might not be enough since the node-local-dns pods run with `hostNetwork: True`
+
+One way to enable connectivity from node-local-dns pods to clusterDNS ip is to use an ipBlock rule instead:
+
+```
+spec:
+  egress:
+  - ports:
+    - port: 53
+      protocol: TCP
+    - port: 53
+      protocol: UDP
+    to:
+    - ipBlock:
+        cidr: <well-known clusterIP for DNS>/32
+  podSelector: {}
+  policyTypes:
+  - Ingress
+  - Egress
+```