[python] Connecting postgresql with sqlalchemy

I know this might be really a simple question but I don't know the solution. What is happening here when I try to connect to postgresql? I am self learner in this field of database and programming so please be gentle with me. When I try following code:

import sqlalchemy
db = sqlalchemy.create_engine('postgresql:///tutorial.db')

I get this error:

Traceback (most recent call last): File "", line 1, in db = sqlalchemy.create_engine('postgresql:///tutorial.db') File "C:\Python27\lib\site-packages\sqlalchemy-0.7.5dev-py2.7.egg\sqlalchemy\engine__init__.py", line 327, in create_engine return strategy.create(*args, **kwargs) File "C:\Python27\lib\site-packages\sqlalchemy-0.7.5dev-py2.7.egg\sqlalchemy\engine\strategies.py", line 64, in create dbapi = dialect_cls.dbapi(**dbapi_args) File "C:\Python27\lib\site-packages\sqlalchemy-0.7.5dev-py2.7.egg\sqlalchemy\dialects\postgresql\psycopg2.py", line 289, in dbapi psycopg = import('psycopg2') ImportError: No module named psycopg2

Do I need to install psycopg2 separately? What is the correct connection string for postgresql?