I was away from coding in Visual Studio 2008 for a while, instead i was using it for drawing class diagrams and reading some code.
While i was doing that i disabled some package because of an error and then as it turned out i was not able to use the Exception details view in the Visual studio. i.e. If i ask visual studio to break if an exception occurs by going to Debug -> Exceptions it breaks but doesn't show me the details of the exception which occured.
As soon as this happened i went to Visual studio output window and saw a message in the general category which said that Visual Studio is unable to load package "8D8529D3-625D-4496-8354-3DAD630ECC1B" and i should use "devenv /resetskippkgs" to load the package.
As i tried to do that the package still failed to load without giving any reason as to why its not loading the package.
On doing some searches i figured out the problem happens many a times in Visual Studio 2008 and the solution is to repair the .NET Framework 3.5 SP1 from Add Remove Programs snap in.
Once the repair is done use resetskippkgs option to start Visual Studio and the problem is resolved.
I am not sure if this is the most efficient way to solve this problem but it works nonetheless :)