I have resolved this issue. The problem was with the Apache Server, which was set up to serve as local repository. Even though I was able to ping the Fully Qualified Domain Name (FQDN)(local.repo.com) of the server, it seems that Yum was not able to reach the server server through (http://local.repo.com) "http" protocol. What I observed was this:
1) The etc/host file had an IP-FQDN mapping for local.repo.com
2) The Apache server had the following entry in /etc/httpd/conf/httpd.conf
Options Indexes FollowSymLinks
Since I could not figure out why Yum couldn't access the local repo through HTTP protocol i.e.; (http://local.repo.com), I did the following:
1) removed the above lines from httpd.conf file
2) In all the .repo files, mentioned the IP address instead of FQDN.
3) I did not remove IP-FQDN mapping for local.repo.com from the /etc/hosts file
4) In the /etc/yum.conf file, I mentioned the following
(Please note that the above steps, fixed the issue I was failing. There could be more proper answer to this problem).