Following procedure is written for VMWare ESXI 5.0, (variable name varies for ESXi 5.1- vhv.enable)
1. Following variable needs to be set to enable nested virtualization on EXSi 5.0:
echo 'vhv.allow = "TRUE"' >> /etc/vmware/config
2. One need to enable promiscuous mode on the portgroup that will be used for your nested XenServer VM for network connectivity

Procedure to bring up a XenServer 6.1 VM:

1. Create a VM,

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