Let's not get bogged down here. Possibly that line could be omitted, but if you make a stand-alone version (without the USB chip) then you would need it.
Thanks alot ! 
Yes this only makes sense when using USBtinyISP.
I need to learn more on SPI... Actually I have difficulty making a distinction from
UART - This is a Tx -> Rx & Rx -> Tx single device connection right?
I2C - As for as I know, this is a 2 wire protocol which can accept a maximum of 255 channels and any device connected to the same channel gets the message sent
SPI - As for SPI, I will try to see the link but so far I have no clue ! 
Cheers
I am too asking questions to learn. I do have a small project (a 16 relay board with 2 pots connected to ADC and 4 buttons) and am trying to design the board from scratch without the usb connection and without the usb-to-serial-ftd-chip.
Xenobius:
I2C - As for as I know, this is a 2 wire protocol which can accept a maximum of 255 channels and any device connected to the same channel gets the message sent
No. Better read this:
Vincent19:
So, is that means it is better not to connect any input/output device at the MOSI, MISO and SCK pins ?
You can safely use them for push buttons and similar inputs that don't mind being driven by the programmer, and for non-critical outputs such as the Data and RS inputs of a text-mode LCD display (the LCD ignores what you put on Data and RS until you pulse EN).