The UN has called on countries to give greater urgency to sanitation, particularly efforts to end open defecation.

"We must break taboos. As was the case for the word 'toilets' a few years ago, it is time to incorporate 'open defecation' in the political language and in the diplomatic discourse," the deputy secretary general, Jan Eliasson, said in a keynote speech at a annual World Water Week event in Stockholm, Sweden.

He has urged states to step up their efforts on sanitation, which is the subject of the seventh millennium development goals (MDGs). Meeting the target would involve reducing the proportion of people without access to sanitation from 51% to 25% by 2015. The World Health Organisation (WHO) says the objective is off track but, even if it were met, about 1.7 billion people will be without access to sanitation.

In 2008, aid commitments on water and sanitation comprised $7.4bn (£4.7bn), or 5%, of reported development aid, lower than other commitments for social sectors, including health and education, and lower than those for government and civil society, transport and storage, and energy and agriculture. Compared with health and education, the share of development aid for sanitation and drinking water has markedly decreased over the past decade.

Sub-Saharan countries agreed five years ago at an African Union summit to spend 0.5% of GDP on sanitation and hygiene, but only a handful of those countries have budget lines for sanitation, and none of them have come close to meeting their commitment.

In March, Eliasson sought to redress the balance by launching a UN call to action aimed at providing all people with access to sanitation. The aim is to end open defecation by 2025.

More than 2.5 billion people lack adequate sanitation worldwide. Of these, 1 billion people practise open defecation. In the least developed countries one in four people defecate in the open, largely as a result of poverty.

Eliasson also drew the link between poor sanitation and ill-health. "Diarrhoea is, after pneumonia, the biggest killer of children under five in the world, responsible for 800,000 deaths each year – around 2,000 children every day," he said.

"Even when diarrhoea does not kill, it empties nutrients from the body which in turn, and after repeated occurrences, results in stunting, stopping children in their growth. Stunted children are not just shorter and thinner. They are more vulnerable to disease and their brains do not develop as they should."

Recent studies suggest a strong link between open defecation and undernutrition in India, where rates of stunting are high, despite strong economic growth. The latest estimates (pdf) show that 48% of under-fives in India are stunted. Children there tend to be shorter than their sub-Saharan African counterparts, even though Indians are, on average, richer.

Eliasson also laid out the financial case for improving sanitation and hygiene. According to the WHO, inadequate water supply and sanitation amounts to annual economic losses of $260bn, while the benefits of meeting the MDG target on water and sanitation would amount to $60bn.

Poor sanitation, on the other hand, costs countries some countries billions of dollars a year, according to the UN – $448m in Cambodia, $3bn in Nigeria, $4.2bn in Pakistan and $53.8bn in India.

"We also know that every dollar spent on water and sanitation can bring a fivefold return, mainly through diminished health costs and increased work productivity," Eliasson said.

The deputy secretary general cited the sanitation and water for all initiative – which brings together ministers of finance, water and sanitation, civil society and international organisations – as an example of the co-operation needed from different sectors to crack the sanitation problem.

"It is self-evident that dealing effectively with the water and sanitation crisis is fundamental to fighting disease and poverty," he said. "It is key for enabling a life of dignity for billions of people around the globe. In a world of population growth and pressures on water resources within and among nations, sound and fair water management is a huge task and a clear imperative."