You're missing a couple of key pieces of information here.

1. What is your backup plan? How long must a full backup be available on disk and how often will you stream the backups to tape?

This question must be answered for both the SQL Server database and the XML files at the disk level.

We are planning to have Mirroring. Log shipping also could be possible.

XML Files will be kept in the processed folder. There is no separate backup plan for that.

2. How long do you need to keep the original XML files?

May be a month

3. How long do you need to keep the XML data in a table before you can begin removal of the data through an archive system?

4 Months

4. Will you be shredding the XML and storing the individual shredded elements anywhere else in the database?

No