Could you provide the output what you get when you run the following command from your drupal root directory
drush status --uri="application-uri" --debug
You should be seeing something like below in the output
Drupal version : 7.22
Site URI : www.xyz.com
Database driver : mysql
Database hostname : localhost
Database username : DB-UserName
Database name : DB-Name
Database : Connected
Drupal bootstrap : Successful
Drupal user : Anonymous
Default theme : seven
Administration theme : seven
PHP configuration : /etc/php5/cli/php.ini
Drush version : 5.10.0
Drush configuration : /etc/drush/drushrc.php
Drupal root : /var/www/
Site path : sites/default
File directory path : sites/default/files/
Private file directory path : /mnt/tmp/files-private/
Temporary file directory path : /mnt/tmp/
Check whether you could see the below.
Database : Connected
Drupal bootstrap : Successful
If you see them both then you Drupal is able to connect to the Database, If not then they are not able to connect
You need to check the settings.php in that case.
Also let me know whether you Drupal Front end loads with out any issue
$ export DRUSH_PHP='[path_to_your_php]'