And I found the answer after posting this question. Still posting it here, he is helping someone else in the future.
http://jingfenghanmax.blogspot.in/2010/09/configure-with-host-target-and-build.html
According to this blog in my case
build will be i686-pc-linux-gnu (My PC) the
host will be mipsel- linux (the platform on which I will run my code)
target will be used if I create a cross-compilation toolchain.
Since I am not creating a toolchain, I did not need to specify a target.