Eclipse Debugging Error : Cannot connect to VM

Recently I had trouble with the Eclipse’s debugger on Linux platform. It was unable to connect with VM & used to display following lines:

ERROR: JDWP Transport dt_socket failed to initialize, TRANSPORT_LOAD(509) ["debugInit.c",L476]
JDWP exit error JVMTI_ERROR_INTERNAL(113): No transports initialized
FATAL ERROR in native method: JDWP No transports initialized, jvmtiError=JVMTI_ERROR_INTERNAL(113)

Specifications:
OS: Fedora Core 6
Eclipse: 3.3
Java: SDK 1.6.0.01

After researching through different forums I found the working solution:
Please add following line to your /etc/hosts file

127.0.0.1 localhost

This will permanently fix the problem.