Rain and flash floods have pushed back development works in Uttarakhand by decades and the challenge at the moment is to build smarter projects without impacting the fragile environment of the hilly region, said World Bank's country director Onno Ruhl.

"In Uttarakhand, the challenge is to build smarter, so that they do not undermine the fragility of the environment," he told PTI after the approval of a $250 million credit for the rehabilitation work in the state by the World Bank's board in Washington on Friday.