suggest me best language to do parsing of squid log file in linux
It really depends on what you want to do as far as your parsing is concerned. Python is a fast language to learn and provide a good basis for many maintenance scripts. PERL would be another good choice, though I have very little experience with it personally. You always could just do then entire process using a shell script, but if you have a larger end goal for the logs, such as recording them in a database, or providing a searchable web interface, you may want to try a more specialized language such as PHP.
Ultimately, before we can give you any reasoning for picking a particular language, we need to know what your ultimate goal will be.