Earlier this year, in a sweltering classroom in Delhi, I met a young Indian boy named Ram. His father is a watchman in a government apartment block, and the family live in the building’s garage. But there is no toilet, so Ram, a small, whipsmart and endearingly cheeky boy, must cross two busy highways to get to the overcrowded public toilet in a nearby slum.

Obviously, rather than risk this, Ram and his siblings sometimes do their business in the open near the apartment block, making him one of India’s 564 million people who practise open defecation. Because of this, Ram told me: “They’re throwing us out.” I asked where his family will live instead and he just shrugged.

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Ram is an example of the idea that children can be active citizens. They earn this right because they can teach us adults things we have forgotten, as with a child’s most common lament: “That’s not fair!” They are right: it has been 25 years since India launched itself on to the path of structural adjustment, and despite media focus on its growth, triumphs and controversial prime minister Narendra Modi, it’s not just Ram who should be saying that there is too much about modern India that is not fair.

Modern India has a massive middle class (the third largest in the world after China and the US), economic growth that makes market economists salivate and the third largest number of billionaires. It also has 250 million people with zero assets. Not even a radio. And, as Caught Short, a new report by WaterAid reveals, it has more stunted children than any other country. Nearly 50 million Indian children are stunted, including Ram. Probably because, like millions of other Indian toddlers, he was constantly exposed to disease carried by faecal particles he encountered when going to the toilet wherever he could.

A single gram of human excrement can contain 10m viruses, 1m bacteria, 1,000 parasite cysts and 100 worm eggs. Living barefoot and not washing your hands, you’re likely to ingest dangerous bugs with your food and drink, if you have any. Diarrhoea ensues; and any nourishment children do get is washed out by the bugs, stunting their growth and development. Half of all cases of malnutrition are linked to diarrhoea, says WaterAid. If a child experiences five or more cases of diarrhoea before the age of two, he or she may be stunted. Beyond that age, “the effects are largely irreversible”.

Ram’s situation is unfair and immoral, but it’s also uneconomical. Poor sanitation loses India 6.4% of GDP – $53.8bn – according to World Bank calculations. It is now well known that investing a dollar in sanitation can save a government $6-8 in costs: healthcare, mostly, but also days not worked and children whose earning potential is as stunted as their height.

The writer and activist Harsh Mander, author of a searing book on Indian indifference called Looking Away, would give children a fair start (which is the name of a current Unicef India campaign), in the form of a universal social floor. It would cost 10% of GDP and cover an equal school environment, where children of different backgrounds – income, ethnicity or religion – are schooled together. There would be access to basic healthcare, in a country where a quarter of the population fall into poverty because of hospitalisation costs. This is not a fantastical proposition. In 2014, World Bank president Jim Yong Kim said that “there’s now overwhelming evidence that [user fees for healthcare] actually worsened health outcomes”. Higher taxes? What an unfashionable notion. Yet India’s tax income is 14% of GDP, one of the lowest among similar nations.

It is common in India to stop at traffic lights and see a young girl with dirty hair and a wide smile gesturing to her mouth; or a boy selling tissues or trinkets. It has also become far too common, on a micro and macro level, for India’s thriving middle class to look away – or worse, to look through. Unicef’s Fair Start campaign highlighted this with a film that used children from marginal communities as actors. It may not seem a sophisticated concept, but it is groundbreaking for one reason: when the film’s wealthy children see poor children begging, or heading off into the bushes to go the toilet, they actually notice them. Unlike the adults, who have learned that windows can be opaque, these children see clearly to the other side of their prosperity and privilege.

Do we have to wait for this generation to grow up before we stop tolerating the current levels of inequality and poverty? No one is asking Indians to look through a looking-glass. Just a window, and to acknowledge that the poverty on the other side is not only unfair and unacceptable, it’s fixable.