'bz2file' not being recognized from PYTHONPATH

[sandeshc]

On extracting the bz2file's source (tar.gz) and placing the folder's path in PYTHONPATH, I expected bz2file to be visible to other python scripts. But I faced the following error while installing a library smart_open 1.3.4 from source. Using the version bz2file-0.98 with Python 2.6.6. This problem is however not reflected with other libraries that I was trying to use.

PS : This machine has no connectivity to internet, hence the download errors.

>>  python libs/smart_open-1.3.4/setup.py test
running test
Checking .pth file support in .
/usr/bin/python -E -c pass
Searching for bz2file
Reading http://pypi.python.org/simple/bz2file/
Download error: [Errno 101] Network is unreachable -- Some packages may not be found!
Reading http://pypi.python.org/simple/bz2file/
Download error: [Errno 101] Network is unreachable -- Some packages may not be found!
Couldn't find index page for 'bz2file' (maybe misspelled?)
Scanning index of all packages (this may take a while)
Reading http://pypi.python.org/simple/
Download error: [Errno 101] Network is unreachable -- Some packages may not be found!
No local packages or download links found for bz2file
error: Could not find suitable distribution for Requirement.parse('bz2file')