India's IT and outsourcing industry could see a mid-term boost from the current turmoil in the financial markets, the president of India’s National Association of Software and Services Companies (NASSCOM) said Tuesday.

"I think there will be a short-term blip," said Som Mittal, speaking at a Tokyo news conference. "I think there will be more control processes that will be put in, which will all be IT and system-driven, so I think there will be more changes that would happen and for that I think there is more work."

"I'm not looking at this change as an opportunity, none of us should. But I'm sure it will lead to one because there would be systems and checks and balances and technology should be brought in to do this," he said.

Investment bank Lehman Brothers collapsed over the weekend after investors lost confidence in the 150-year old bank and it failed to find a buyer. At about the same time Bank of America reached a deal to acquire Merrill Lynch and insurer American International Group searched for and found a US$20 billion [b] financial lifeline.

The knock-on effects to India's IT industry from the failure of any one company or even a lull in business in a sector will also be offset thanks to the diversification that has happened in recent years, said Mittal.

"We are doing work in healthcare, utilities, transport, airlines. They may also have some impact but they are growing. From a business perspective our diversity will help," he said.

Within the banking sector in particular the work done by Indian IT companies is an integral part of their operations so this should also help insulate them further, he said.

"The work [the bankrupt companies] were doing still has to be done," he said. "Someone still has to run banking, and I think we're and integral part of that supply chain. The amount of supply chain processing that is done for these banks will still have to be done and will increase."

Mittal, who previously headed Hewlett-Packard's Asian operations, is in Japan to meet with local business leaders and political figures as part of an attempt to grow the market for Indian outsourcing in Japan.