Thanks alot virtual for your suggestions and helping attitude.
Solved the issue as follows.
Follow the instructions given by syl in http://www.anddev.org/solved_emulator_p ... t8534.html
If you still do not get the net connection, go to TCP/IP settings - > See whether 'Obtain an IP address automatically' is selected -> if not, select it and give your DNS server -> open the browser in emulator -> u will have ur problem solved
When you do these settings, make sure that you do not give any proxies for your IE or Mozilla browsers in your computer.
Rather than running queries for getting connection, I presume doing the required settings from phone itself is the good workaround.