Currently I do not have ground in my house wiring. I am planing to install ground wiring but the floor around the main service panel is cemented and I don't think I can place a ground rod in the floor. There is an iron rod sticking horizontally out of the wall behind where my main service panel is(main service panel is in the garage). There is a wire wrapped around that rod, which seems to be made out of steel, going into the ground. I think it was installed when the house was built (1968). can I connect the ground wire to that rod?
Get a licensed electrician to do any work with electrical grounding of a house. It could save your life one day.
That said, you should check what you local electrical laws state but I'll think you'll find that your existing ground wire, if that's what it is, won't meet regulations.
It may be a simple case of putting a grounding rod in the nearest patch of open ground. It may also mean that you have to drill through the slab to get to the ground. It's up to the local laws.
EDIT: My advice would be to NOT use the existing infrastructure if you have any doubts about it at all. Ideally, grounding should be really easy to trace and access. Good grounding could save your life one day and you want to trust it.