Across a filthy, rubbish-filled creek we enter the slum’s heaving residential area, treading carefully to ensure we do not step in human sewage. Live wires hang from wobbly walls; we crouch through corridor-like passages between houses made from reclaimed rubble as the sky disappears above our heads. Behind flimsy doorway curtains we spy babies sleeping on dirty mattresses in tiny single room homes, mothers busy washing, cooking and cleaning.

The few hours I spend touring Mumbai’s teeming Dharavi slum are uncomfortable and upsetting, teetering on voyeuristic. They are also among the most uplifting of my life.

Instead of a neighbourhood characterised by misery, I find a bustling and enterprising place, packed with small-scale industries defying their circumstances to flourish amidst the squalor. Rather than pity, I am inspired by man’s alchemic ability to thrive when the chips are down.

I’ve wanted to visit Mumbai since Danny Boyle’s Slumdog Millionaire swept to Oscar glory. The film is set in Dharavi , the dusty creek-bed where one million souls live in an area the size of London’s Hyde Park, surrounded on all sides by Asia’s most expensive real estate.

Post-Slumdog, the controversial "slum tourism" industry boomed, offering curious tourists a glimpse of life inside the shantytown. I join an eye-opening trip run by Reality Tours, who have been taking tourists to Dhravi since 2006. I want to see what impact Slumdog has had on the people whose lives it dramatises, and find out if the reality lives up to the fiction.

The tour begins outside Leopold’s Cafe in Colaba, the 140-year-old traveller haunt targeted during November 2008’s terrorist attacks. Our enthusiastic guide Asif describes a Bombay where incomers dream of emulating the success of Bollywood star Shahrukh Khan, who rose from humble beginnings to become “the world’s sixteenth most powerful man”.

Before reaching Dharavi, we are introduced to the harsh existence of Mumbai’s poor. First stop is a shelter near Churchgate station providing food and medicine for street kids – 70 per cent are addicted to drugs. Next, an uncomfortable kerb crawl through Kamathipura, a red district housing thousands of female sex workers, brought to Mumbai from all over India by traffickers under false pretences, then forced into prostitution to repay the favour.

Then Dhobi Ghat, a vast open air laundry where ten thousand muscular male washers toil from three in the morning until ten at night for 200 rupees a day (£2.65). Carefully tagged, washed by colour, then hung to dry in the sun, clothes have been cleaned here for 150 years. Residential demand is declining with the growing affordability of washing machines, but most hotel laundry still comes here: a few days earlier my laundry came back the same day beautifully pressed, socks sewn together with string so none went missing.

Eventually Dharavi. The long drop toilet shown in Slumdog is a fiction, but the reality is little better: grim blocks serve 16,000 people each. Depressingly, what little open space exists is completely covered by mounds of rubbish; small children defecate alongside stray dogs.

But this is the worst of Dharavi. In other respects the slum is thriving, with schools, shops, mobile masts, electricity and running water (for part of the day), even TVs in most homes.

We visit the plastic recycling district, where discarded containers are sorted by colour, crushed into machines, melted into spaghetti-like strips of plastic, then cut into tiny pellets; before being reconstituted into everything from children’s toys to washing machines.

Up three stories we emerge into blazing sunshine to discover huge mounds of plastic being sorted, roofs as far the eye can see, and, in the distance, the luxurious enclave of Bandra, where middle class Indians and expats live in apartments costing £1550 per month: in Dharavi the average monthly rent is 2000 rupees (around £25).