But that raises the question, isn't it a kind of punishment to to be deprived of the sight of God's face for eternity, and separated from the parents who may be in Heaven? Now at last the Pope theological commission has come up with a more sophisticated answer to the question. Read it in full here. Below is an extract.
The Church is conscious that this salvation is attainable only in Christ through the Spirit. But the Church, as mother and teacher, cannot fail to reflect upon the fate of all men, created in the image of God, and in a more particular way on the fate of the weakest members of the human family and those who are not yet able to use their reason and freedom.
It is clear that the traditional teaching on this topic has concentrated on the theory of limbo, understood as a state which includes the souls of infants who die subject to original sin and without baptism, and who, therefore, neither merit the beatific vision, nor yet are subjected to any punishment, because they are not guilty of any personal sin. This theory, elaborated by theologians beginning in the Middle Ages, never entered into the dogmatic definitions of the Magisterium, even if that same Magisterium did at times mention the theory in its ordinary teaching up until the Second Vatican Council. It remains therefore a possible theological hypothesis. However, in the Catechism of the Catholic Church (1992), the theory of limbo is not mentioned. Rather, the Catechism teaches that infants who die without baptism are entrusted by the Church to the mercy of God, as is shown in the specific funeral rite for such children. The principle that God desires the salvation of all people gives rise to the hope that there is a path to salvation for infants who die without baptism (cf. CCC, 1261), and therefore also to the theological desire to find a coherent and logical connection between the diverse affirmations of the Catholic faith: the universal salvific will of God; the unicity of the mediation of Christ; the necessity of baptism for salvation; the universal action of grace in relation to the sacraments; the link between original sin and the deprivation of the beatific vision; the creation of man “in Christ”.
The conclusion of this study is that there are theological and liturgical reasons to hope that infants who die without baptism may be saved and brought into eternal happiness, even if there is not an explicit teaching on this question found in Revelation. However, none of the considerations proposed in this text to motivate a new approach to the question may be used to negate the necessity of baptism, nor to delay the conferral of the sacrament. Rather, there are reasons to hope that God will save these infants precisely because it was not possible to do for them that what would have been most desirable— to baptize them in the faith of the Church and incorporate them visibly into the Body of Christ....We emphasise that these are reasons for prayerful hope, rather than grounds for sure knowledge. There is much that simply has not been revealed to us (cf. Jn 16:12). We live by faith and hope in the God of mercy and love who has been revealed to us in Christ, and the Spirit moves us to pray in constant thankfulness and joy (cf. 1 Thess 5:18).