I am trying to understand the real requirement of the usage of templates for policy based design. Going through the new templated designs in C++ I found that policy based class
Depends on the situation I guess... A possible downside of using templates is that the type should be known at compile-time:
HelloWorld<English> hw; // English is plugged at compile-time
In your second example, where you're using a pointer-to-base, this pointer might point to a variety of derived classes. What exactly it points to is not required to be known at compile-time and can therefore be determined by (user-)input at runtime. A possible down-side of this approach is virtual call overhead. In some applications, and on some platforms, this might be unwanted.
Both are valid ways of structuring, it actually depends on the requirements. E.g.
Runtime vs compile time polymorphism.
When do you want/can/have to achieve polymorphism ?
Performance overhead of virtual calls
Templates generate code that has no indirections
The actual usage of the class.
When you have to store heterogenous collections, a base class is needed, so you have to use inheritance.
A very good book on policy-based design (a bit dated but good nevertheless) is Modern C++ Design