Reference to headings in files present in a different directory is not working for some reason, so I included web links for them, would like to inculcate a workaround if possible.

I am not sure why the references are not being generated automatically, but you can for ce a reference to be created like the top line here and then refer to them as

:ref:`development-environment`

@mattip everything is working as expected now.

Thanks @kritisingh1