Yum command fails with an error "No module named iniparse"

Issue

yum update

There was a problem importing one of the Python modules
required to run yum. The error leading to this problem was:

   No module named iniparse

Please install a package which provides this module, or
verify that the module is installed correctly.

It's possible that the above module doesn't match the
current version of Python, which is:
2.4.3 (#1, Sep 17 2008, 16:07:08)
[GCC 4.1.2 20071124 (Red Hat 4.1.2-41)]

If you cannot solve this problem yourself, please go to
the yum faq at:
  http://wiki.linux.duke.edu/YumFaq