This is how I would do it:
Create a hash table for all the characters from string Y. (I assume all characters are different in Y).
First pass:
Start from first character of string X.
update hash table, for exa: for key 'a' enter location (say 1).
Keep on doing it until you get all characters from Y (until all key in hash table has value).
If you get some character again, update its newer value and erase older one.
Once you have first pass, take smallest value from hash table and biggest value.
Thats the minimum window observed so far.
Now, go to next character in string X, update hash table and see if you get smaller window.
Algorithm complexity:
O(n) : One pass
space: O(k)
Edit:
Lets take an example here:
String x = "coobdafceeaxab"
String y = "abc"
First initialize a hash table from characters of Y.
h[a] = -1
h[b] = -1
h[c] = -1
Now, Start from first character of X.
First character is c, h[c] = 0
Second character (o) is not part of hash, skip it.
..
Fourth character (b), h[b] = 3
..
Sixth character(a), enter hash table h[a] = 5.
Now, all keys from hash table has some value.
Smallest value is 0 (of c) and highest value is 5 (of a), minimum window so far is 6 (0 to 5).
First pass is done.
Take next character. f is not part of hash table, skip it.
Next character (c), update hash table h[c] = 7.
Find new window, smallest value is 3 (of b) and highest value is 7 (of c).
New window is 3 to 7 => 5.
Keep on doing it till last character of string X.
I hope its clear now.
Edit
There are some concerns about finding max and min value from hash.
We can maintain sorted Link-list and map it with hash table.
Whenever any element from Link list changes, it should be re-mapped to hash table.
Both these operation are O(1)
Total space would be m+m