It is very important to get rid of dental infection from any tooth (milk or permanent) otherwise it may spread to other milk teeth and most importantly it may grow downwards and damage the permanent successor tooth in the region.
Cavities are infection of germs on the teeth. To put it in simple terms, they are holes / depressions on the teeth. Technically they are known as dental caries.
Plaque is a sticky white film that is continuously formed on a day to day basis on everybody's teeth. It consists of food particles, bacteria etc. It is the main cause of all dental infectious diseases. If allowed to remain on teeth, it hardens to form tartar (calculus's solidified food debris) which cannot be removed by a normal toothbrush.
The sugar that we eat gets stuck on the valley like surface of teeth in the form of plaque. There it degenerates by the action of bacteria and in this process acids are released. They attack tooth enamel and dissolve it. After many such attacks the enamel completely breaks down and a small cavity is formed. This acts as a focus for food accumulation and a vicious circle is formed. Ultimately it results in a full-fledged dental decay.