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To put some numbers on this, about 600 million Indians rely on open defecation. Some researchers think that this is a key to the "Asian enigma"--the problem of why Indian children are shorter on average than African children even though African children are on average poorer (which normally correlates well with height).

Researchers have found that open defecation leads to stunted growth, and also higher child mortality rates. The later could explain another puzzle of India--why Hindu children have higher mortality rates than Muslim children, even though Hindus are on average richer and more educated.

It turns out that Indian Muslims are about 20 percent more likely to use toilets than Indian Hindus, regardless of income level.

Here's an article on this: http://arstechnica.com/science/2014/06/open-defecation-solve...

Here's a research paper on the connection between open defecation and stunted growth: http://journals.plos.org/plosone/article?id=10.1371/journal....