Australian Journal of Maritime & Ocean Affairs

ISSN: (Print) (Online) Journal homepage: https://www.tandfonline.com/loi/ramo20

Role of policy framework for disruptive

technologies in the maritime domain

Nitin Agarwala

To cite this article: Nitin Agarwala (2021): Role of policy framework for disruptive
technologies in the maritime domain, Australian Journal of Maritime & Ocean Affairs, DOI:
10.1080/18366503.2021.1904602

To link to this article: https://doi.org/10.1080/18366503.2021.1904602

Published online: 22 Mar 2021.

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AUSTRALIAN JOURNAL OF MARITIME & OCEAN AFFAIRS
https://doi.org/10.1080/18366503.2021.1904602

Role of policy framework for disruptive technologies in the

maritime domain
Nitin Agarwala
National Maritime Foundation, New Delhi, India

ABSTRACT KEYWORDS
Studies around the world have identified a multitude of innovations Disruptive technology;
that have the potential to create an economic impact and disrupt disruptive innovation;
various facets of life in the coming years. Most of these maritime domain; policy;
policy-framework
innovations are disruptive in nature and have a direct or an
indirect usage potential in the maritime industry. Since the
maritime industry is largely a reactive one that is driven by
regulatory pressures and commercial requirements, the transition
to such new technologies will happen only when existing
methods become obsolete or when they cannot cope up with
the increasing demands at sea and/or in harbour. In order to
exploit the true potential of these disruptive technologies,
regulations are essential. However, traditionally, policy makers are
slow to adjust to changes in technology and providing the
required regulations in time, without realising that a good policy
can create opportunities for the government to save public funds
and earn additional revenues.
This article thus discusses the issues that create a governance
gap and the efforts the policy makers can put in to narrow this
gap. In addition, the feasibility of creating a policy framework to
maximise the potential of these emerging disruptive technologies
in the maritime industry will be discussed.

1. Introduction
With the pace at which the technology of today is evolving (Gates 2019; Dialani 2019;
Urban Hub 2019), it is hard to predict exactly which one of them will be disruptive. So
what is it that makes a technology disruptive! By a general understanding, any technology
is considered disruptive if either it has the ability to displace an established technology,
and shake up the industry with its innovation or it is a ground-breaking product that
creates a completely new industry. According to Clayton Christensen, who popularised
the idea of disruptive technologies in his book ‘The Innovator’s Dilemma’ published in
1997 (Christensen 1997), disruptive technologies are sometimes described as being sim-
ultaneously destructive and creative because they make old products — and sometimes
even entire industries — obsolete, creating space for new ones. Such technologies have
the power to change the way we work, live, think and even behave. More often than not,
the term ‘disruptive technology’ is understood as related to gadgets and electronics, but it

CONTACT Nitin Agarwala nitindu@yahoo.com

© 2021 Informa UK Limited, trading as Taylor & Francis Group
2 N. AGARWALA

can also apply to concepts and services. It needs to be kept in mind that disruptive inno-
vation and disruptive technology are considered synonymous; however, the former is actu-
ally an over-encompassing concept as there are few technologies that are intrinsically
disruptive or self-sustaining by creating better products in by themselves. It is, in fact,
the business model that the associated technology facilitates, enables the impact of dis-
ruption and changes the entire markets.
When large businesses focus on their most demanding customers, it provides an
opportunity for smaller companies to address the overlooked customer’s utilising ‘disrup-
tive’ mechanism. Before the large business houses realise, these small and disruptive com-
panies have moved upstream and cannibalised more customer segments. Since no
company can continue to lead the innovation curve forever, the best way to stay in
business is to acquire the pioneering companies along with their expertise and continue
the disruptive success.
This therefore leads us to questions such as – what is the associated policy framework
for adopting such disruptive technologies? what are the ground rules and/ or policies
governing such disruptions and who frames these rules and policies?
Before we delve into the answers, it is essential to understand that a policy framework is
generic and an over-encompassing document. It comprises of a ‘standard model of policies’
and a ‘related detailed procedures’ that are specific and are developed to be used as a
basis for decision making. While an advocacy group might propose a policy framework
to suggest certain ideas to a government, the associated policy needs to be refined
and developed further by the policy makers as they deem fit. Briefly, a policy spells out
merely the goals and planned activities. To provide it a legal framework, laws are required.
For these laws to be effective, a government policy is essential.
Traditionally, policy makers have been slow to adjust to changes in technology.
However, technology, that is disruptive, presents significant regulatory challenges that
question the process of decision making in completely new ways. To be effective, the
regulation, thus needs to be proactive, dynamically responsive and must adapt to
these technological changes or be left behind. Hence, there is a continuous pressure
on the policy makers and regulators to keep pace, adapt and promulgate policies for
such new technologies. It is important to realise that a good policy can create opportu-
nities for the government to exploit the technological advancements, save public
funds, and earn additional revenues through alternative taxation or fee arrangements.
However, to be able to frame correct policies, the policy makers need to be aware of
how innovators think about issues and interact with the rest of the society. Once done,
it is essential that policy makers move quickly to leverage these changes in order to
protect the society, foster innovation and serve better a very adaptive public.
With this understanding, the article looks at some basic issues pertaining to the exist-
ing policy framework associated with the disruptive technologies in the maritime domain
and explores the causes that create this governance gap. In doing so, it first provides the
historical setting of innovation and the limited academic discussion available in the field
of disruptive technology in the maritime domain. It then explores the innovations in the
maritime domain that are disruptive and are causing a governance gap. Once done, it dis-
cusses the efforts the policy makers can make to reduce this governance gap. Finally, it
explains how a policy framework can be created to maximise positive disruption in the
maritime industry.
 AUSTRALIAN JOURNAL OF MARITIME & OCEAN AFFAIRS 3

2. Background
The word ‘innovation’ first appeared in the English language in the mid-1550s and its
usage has increased steadily ever since. The word itself means ‘something new and
different’ (Webster n.d.) and refers to products, processes, organisational structures, pol-
icies, societal institutions and services alike (Nair et al. 2015). The purpose of an innovation
is socio-economic transformation and the overall development of the society (Thapa,
Iakovleva, and Foss 2019). This innovation is driven by entrepreneurship, technology,
knowledge and the industry (Hjalager 2010). It is no wonder that the European Commis-
sion has made innovation as a central element to rekindle the European economy (Fager-
berg and Verspagen 2009).
Earlier, academic literature on ‘innovation’ was limited to find. However, since the word
has been used extensively by companies, consultants and politicians, a large literature has
emerged in recent years on various aspects, types and fields of innovation. While the
quantity of literature has increased, one realises that innovation studies are not organised
as a scientific discipline even though they continue to be studied for a range of areas that
include marketing, economics and engineering (Nair et al. 2015).
Most of the literature dealing with innovation focuses on the impact of innovation on
economic growth (Gurbiel 2002; Rosenberg 2006; Pece, Simona, and Salisteanu 2015;
Zalewski and Skawińska 2009; Shukla 2017) as innovation is seen as one of the driving
forces behind a sustainable development for any nation. This has allowed innovation
to be encouraged by most countries as an engine for prosperity and growth. Before we
delve any further on innovation and the disruption it causes, it is important to differen-
tiate between ‘innovation’ and ‘invention’. While an invention is an idea, a sketch or
model of a new improved service, product, process or system, innovation is accomplished
only when the first commercial transition involving a new device, product, process or
system happens.
This understanding has a greater importance, especially since digital technologies are
changing how innovation occurs, thereby creating disruptions in nearly all economic
sectors (Paunov, Planes-Satorra, and Ravelli 2019). Today, as data collected is increasing,
this data has become a key input for innovation. Such innovations are allowing develop-
ment of new products and services that in return are helping the development of numer-
ous digital technologies (Paunov, Planes-Satorra, and Ravelli 2019), as seen in Figure 1,
many of which are disruptive.
The maritime domain, like any other domain, has been impacted by numerous inno-
vations especially those associated with digital technologies. Unlike the various disci-
plines on land wherein the impact of innovation and innovation studies have been
documented to some extent, those in the maritime domain have not been done so,
largely because the maritime domain has always lagged behind their terrestrial counter-
parts. It is no wonder that there is little academic literature related to innovation of dis-
ruptive technologies in the maritime domain. This said, for the maritime sector, the
impact of innovation due to disruptive technology need to be visualised in two key
areas, namely, the shipping industry itself and the trade that moves on this industry.
While the available literature is limited, one such available literature is the technical
report by the Nanyang Technological University, Singapore, that looks at 3D printing,
blockchain, eCommerce and Battery Technology in Harbour craft as the four disruptive
4 N. AGARWALA

Figure 1. Some disruptive technologies specific to the Maritime Domain (Source: Author).

technologies in the maritime domain and aims to provide new insight on their impact on
maritime trade and industry (Lam, Goh, and Pu 2020). Similarly, an article by Balan shows
the availability of a mere 24 papers between 2010 and 2018 on the disruptive impact the
advancement of ICT has on the maritime transport and supply chains (Balan 2020).
When talking of policy-making in the maritime domain, most of the work is focused on
maritime governance with a focus on blue economy, security, environmental concerns
and legal regulations (Roe 2013; Duru 2014). Limited work (Deloitte 2015; Ferretti and
Schiavone 2016; Balan 2020) can be found on policy-making for disruptive technology
in the maritime domain though some scattered work can be found for regulating disrup-
tive innovation in other fields (Hasselbalch 2014; Tait and Wield 2019; IFC 2019). It is hence
considered essential that the area of policy-making for disruptive technology in the mar-
itime domain is discussed. This article thus contributes to the narrowing of this gap to
some extent.

3. Disruptive technology in the maritime domain

Several studies1 by different agencies and study groups have identified areas that have
the potential to exhibit the greatest economic impact and cause disruption in various
 AUSTRALIAN JOURNAL OF MARITIME & OCEAN AFFAIRS 5

facets of life in the coming years. Some of these disruptive areas and technologies that
have an impact on the maritime industry are seen in Figure 1.
These areas include 3D printing for creating replacement part, web-connected devices or
Internet of Things (IoT) devices for easier, centralised and seamless control of systems,
futuristic weapons such as lasers, electromagnetic rail-guns, and hypersonic weapons,
high throughput satellite communications for point to point and unhindered all weather
communication. Then there are materials designed to have superior characteristics (e.g.
strength, weight, conductivity) or functionality that make them ultra-powerful, ultra-
light, ultra-conductive meta-materials, polymers, alloys and composites. These include,
‘smart’ materials, that have the ability to self-heal, ‘memory’ materials that can regain
their original shapes on removal of force, ‘piezoelectric’ ceramics and crystals that can
generate energy with application of pressure, ‘nanomaterial’ to address target specific
requirements and ‘integrated graphene’ that allow embedding of data and power cables.
The increase of data has allowed development of various inter-twined developments
such as the artificial intelligence that allows future remote and autonomous shipping oper-
ations, cloud computing that permits storage and retrieval of enormous amounts of data
from numerous sources including the Automatic Identification System (AIS) and radar of
autonomous ships. By digitally mapping the ship’s machinery through digital twinning,
continuous monitoring of equipment can be achieved to predict breakdowns before
the equipment fails and to enable remedial measures through replacements and repair.
Similarly, technologies such as that of drones and UAVs have made the physical surveying
process in remote locations easier, while Augmented reality (AR), Virtual reality (VR), and
mixed reality have allowed better training and appreciation of the maritime environment
and hazards. To ensure sustainability, the use of renewables and clean energy sources has
increased by many folds with a singular motive of phasing out fossil fuels.
On the command and decision making front, voice control and virtual assistants have
been developed for controlling systems on the go and chatbots allow interaction with
humans, Big Data permits enterprise-wide visibility and insights to make rapid critical
decisions, intelligent apps and analytics help deliver a compelling and personalized experi-
ence to users and edge computing allows availability of information to help information
processing in real-time. A mix of these disruptive technologies, such as combining IoT
with blockchain – or BIoT – are creating better system controls, the digital identity manage-
ment is permitting management of multiple identities across business and personal net-
works along with visual communication in video conferencing, enhanced location
awareness along with Geo-spatial visualization to create new insights and competitive
advantage, and Machine-to-Machine communications using chips, micro-sensors and at
times both, blockchain technology that provides transparency of goods being transported
to marine insurers, shipping companies, and law enforcement agencies and wireless
energy storage, are changing the way we have been functioning in the maritime
domain so far.
One can notice that the list is endless, since what may seem in its developmental stage
today may suddenly become disruptive tomorrow. Most of these areas, backed by tech-
nology, have a direct or an indirect disruptive potential in the maritime industry.
In general, the maritime industry has been largely a reactive industry. It has primarily
been driven by regulatory pressures and commercial requirements. When existing
methods are unable to cope with the increasing demands at sea and in harbour, the
6 N. AGARWALA

transition to these new technologies becomes unavoidable and changes occur. Since
these changes are inevitable, it is pragmatic to be prepared in advance, rather than
assume that they are not relevant or are a cost burden. Like most good things, these tech-
nologies also have a dark side which can be exploited for personal gains. This therefore
necessitates that some guiding regulations are provided in order to reap the positive
benefits of these future technologies.

4. Need for a regulatory policy

As denudating resources compound the economic stress due to an increasing population
and pollution, governments around the world continue to struggle with an array of
public-policy crises to address issues such as transparency, accountability, budgeting,
spending, regulation and bureaucratic performance. To add to these woes, disruptive
technology is bringing about changes in the way business is carried out. In order to
ensure that the legitimate share from these businesses is available to the government
for addressing the already increasing ‘economic stress’, there is a need for the policy
makers to address policy-formulation for these disruptive technologies (Aitken 2017).
This need arises due to the following reasons:

(a) Government operations. Advances in disruptive technology could disrupt how a gov-
ernment works (e.g. disruptive technology of smart phones has created an infor-
mation security threat for governments forcing either use of custom made phones
such as Blackberry phones or banning their entry in security zones). However, with
appropriate policies, governments could work better by employing these technol-
ogies to their own advantage.
(b) Public protection. Disruptive technologies that address the protection of the public or
those that concern external economic interests need to be handled appropriately
(e.g. technologies such as drones, security algorithms for financial transactions, and
peer-to-peer economies such as Uber, Lyft, WeWork and the likes created disruptions
by providing protection and economic ease to the public) as they directly involve the
security and the economic interests of the nation.
(c) Society and the economy. Disruptive technologies that create societal or economic
value (e.g. use of technologies in day to day activities such as clean technology
and Artificial Intelligence (AI), to name a few, happened before policies could be
put in place) are areas where the influence has already moved into the society due
to their continued use by the common man. Providing governance for these is essen-
tial to avoid the ills that may result if left unregulated.

While at first glance, these reasons may sound irrelevant to the maritime domain, they are
not. They are effective not only in the day-to-day aspects but also in all specialised
domains of technology with the associated ‘problems’ and ‘nuances’ of policy making
being common to all domains. The lacunae lie in the fact that since the governments
lack the state-of-the-art information and infrastructure, they find it difficult to appreciate
the nature and possible impact of these emerging technologies. A need thus exists to
make them informed and confident so that the right decision can be made at the right
time.
 AUSTRALIAN JOURNAL OF MARITIME & OCEAN AFFAIRS 7

5. Why is the policy making slow?

Traditional policy making is conducted behind closed doors by political elites who make a
decision based on government data to serve the public well. The drawback of such a
system is that the department or agency providing the data may or may not have the
requisite domain expertise of the area being discussed. It hence becomes imperative
for the department to determine a mode of outreach and engagement with external
domain expertise which is often time-consuming, especially when disruptive technology
is involved. This is because the available expertise may not be neutral or does not display
policy inclination or even may not be available to the nation.
While these may be the reasons, they surely are not the sole reason why policy making
is slow. The main problem is that there is an ever growing gap between the scale, scope
and speed of the transformations that occur and the capacity of governments to
implement timely and effective policy changes that make ‘innovation-friendly’ regulations
difficult. The governance-gap that is thus created may stem from the following facts:

(a) Given the scope of their responsibilities, lawmakers and ministers have limited time
and attention for any particular issue.
(b) Since the responsibility of decisions taken in their portfolio lies with the minister, they
are reticent to delegate the major decision making – especially in politically sensitive
areas – and they themselves have little time to devote to decision making.
(c) Hierarchical structures in the government create many bottlenecks often leading to
delays.
(d) Policy makers at times prefer to play safe and strictly apply the prevailing law, thereby
forcing innovators to spend over two-thirds of the time dealing with regulations
instead of innovating.
(e) The pace at which technical change occurs, outpaces policy making since the govern-
ment is not geared-up to respond at this pace, e.g. the game Angry Birds saw 50-
million customers within 35 days of its launch (Daily Mail 2012); Reliance JioInfocomm
Ltd. acquired 100-million customers within 170 days (Economic Times 2017) and 215
million in 1 year (ANI 2018).
(f) These technological changes occur over a vast spectrum while the scope of govern-
ment policy making is vertically compartmentalised.
(g) Innovations are risk-taking, while governments are averse to taking risks, thereby
creating a gap in policy making.
(h) Innovations know no borders, unlike governments, who are recognised primarily by
borders.
(i) Disruptive innovations are iterative, unlike governments, which cannot afford iter-
ations. Defining policies early in the innovation cycle can impede innovation and
competition while doing it late policies allows systemic risks to accumulate.

Due to this slow and unresponsive pace of regulatory framing, at times, industry actors
get motivated to try and circumvent regulators by putting public pressure to amend
out-dated rules, for e.g. unwilling to risk losing its competitive advantage – and significant
profits – through delay, UberX launched unilaterally in Canada and dared authorities to
stop it thus forcing change in policies (Fletcher 2015).
8 N. AGARWALA

6. What can policy makers do to stop this growing gap?

When disruption due to technology occurs, it is essential that efforts are made to reduce
the gap between governance and technology since this gap poses a political problem.
Such a disruption usually increases income inequalities by reducing work opportunities
as many are made redundant by robots and e-marketing thereby creating distrust and
anger. Hence, in order to adjust to the ensuing technological changes there is a need
for policy makers to be ahead of the disruption curve in policymaking, analysis and think-
ing. Some possible ways to do so are:

(a) Policy planning has to move from hindsight to foresight. Start today to tackle the big
issues that will dominate tomorrow.
(b) Policy making must become more risk-tolerant and innovative.
(c) Policy making must focus on the outcomes rather than activities or inputs, as it helps
to encourage innovation while ensuring that the governing policy is in place.
(d) It is not essential that the policy maker be knowledgeable in the new technology and
what it can actually do. This necessarily requires that people with the correct experi-
ence need to be part of the policymaking. For this, the principle of: ‘hire, borrow or
grow-your-own’, needs to be employed.
(e) The usual approach to any technology issue in the government is the ‘waterfall
approach’ (see Figure 2). In this approach, the requirements are used to create
detailed specifications which in return produce the detailed development plan and
the deliverables some time later. This unfortunately does not work with disruptive
technologies as the associated iterations are so many that the developer himself at
times may not be certain about the outcome (see Figure 3). The governments
should instead use ‘agile approaches’ that allow both requirements and solutions
to evolve over time (see Figure 4).
(f) Create an ‘openness’ environment, wherein the developer himself can develop the
desired policy, which can be suitably tweaked by the policy makers, if considered
essential.
(g) By changing the working philosophy of the government from inward centric to user-
centred or human-centred can help, as it would put the policy maker in the shoes of
the user and experience the world from their point of view.

Figure 2. Waterfall approach.

 AUSTRALIAN JOURNAL OF MARITIME & OCEAN AFFAIRS 9

Figure 3. Overlapping technological progress in disruptive development.

Figure 4. Agile Approach to policy making.

10 N. AGARWALA

7. How can we create a policy framework?

From the foregoing discussions, it is clear that a timely policy framework is essential for
disruptive technologies. When pondering the need for regulation, policy makers should
ask three general questions before proposing new rules; else carefully tailored regulations
might be appropriate (Hagemann 2016):

(a) Is the harm actual or hypothetical? – if it is hypothetical, then, new regulations are not
required.
(b) Do the existing agencies and regulations address the likely harm? – if they address
the likely harm, then, new regulations are not required.
(c) Are the cost associated with the likely harm more than the cost of implementing the
new regulations? – if the likely harm is more, then, new regulations are required.

Having decided the need for new regulations, it is essential to define how a new regulat-
ory framework for dealing with emerging and disruptive technologies should look like.

(a) The new regulations that are developed and delivered must necessarily undergo revi-
sion after 2 years to ensure that new related developments in the industry are accom-
modated and unintended consequences avoided.
(b) The proposed regulations should cater to provide:
(i) Flexibility – both to the industry and the individuals.
(ii) Support – speed of innovation.
(iii) Permit – experimentation by default.
(iv) Avoid – technological lock-ins.
(v) Minimise – Entry cost to innovators.
(c) Developing regulations in anticipation should be avoided other than when the need
for such rules can be clearly defined. Whenever such anticipatory regulations are
developed, they should be provided with a sunset2 clause to ensure revisions
based on gathered experiences.
(d) While we can evolve policies we need to see how we can help encourage develop-
ment of new technologies, companies and businesses to establish, evolve and
grow (Visionary Analytics 2016). A possible way for this could be:
(i) By encouraging new technologies and companies.
(ii) By encouraging alternate technology to existing ones, where possible.
(iii) By supporting companies with the right mix of infrastructure and policy support
to encourage their growth and operations.
(iv) By encouraging talent.
(v) Ensure that the social cost of the emerging technology as borne by the company
is possible to be shared by encouraging the right education and manpower
availability.
(e) The concept of ‘open policy making’ should be encouraged that would represent a
shift away from traditional policy making towards a process that is accessible and
transparent (Public Policy Forum 2017).
 AUSTRALIAN JOURNAL OF MARITIME & OCEAN AFFAIRS 11

8. Efforts towards policy-making in the maritime domain

Like any other industry, the maritime industry too has seen many disruptive technologies
(Gotkine 2019; Balan 2020; Dupuis and Rey 2018; ECMAR n.d.). These technologies have
seen policies limited to some facets, while yearning for other areas. We discuss herein
some of them for which policies exist and those that need one.

(a) Autonomous shipping is expected to revolutionise both ship designs and operations.
Autonomous ships have the ability to monitor their own health, establish and com-
municate what is around it and make decisions based on that information. However,
the existing maritime laws do not anticipate the development of remote or auton-
omous ships. Of concern are the legal issues related to safe manning requirements
and product liability rules that will in return affect the maritime liability and insurance
rules. It is believed that the required extent of regulatory change will depend on the
level of autonomy. Accordingly, Lloyd’s Register of Shipping (LRS) has published
classification guidance for six autonomy levels (LRS 2017). The first three levels
help designers, builders and operators define the desired level of autonomy, while
the other three levels involve unmanned vessels with varying levels of remote oper-
ation including complete autonomy. The remote operation includes shore-based
operators who can intervene, if required, to avoid navigational disasters.
While the classification rules such as that of the LRS are good for designers, oper-
ators and builders at the ship level, they do not cover the nuances of legal regulations
for operation in the national and international waters. While the regulations for
national waters could get developed with the political will of a nation, the inter-
national regulations of the International Maritime Organisation (IMO) would
require multilateral agreements between various countries which may take up to
10 years for finalisation (Merlie 2017).
(b) Use of disruptive material technology. A number of new materials are being used in the
maritime industries that are disruptive in nature. These include composites (carbon
fibres, thermoplastics and fibre reinforced plastics), those used for additive manufac-
turing, carbon nanotubes (buckypaper), etc. The regulatory framework for the use of
some of these such as composites in the maritime industry primarily focuses on com-
bustibility and fire protection (Sims et al. 2017). Even though composites have a very
high potential in the marine industry, lack of guidelines for acceptable composite
structures outside the field of flammability, have discouraged the development of
composite material as they are plagued with high manufacturing cost, inability of
their being recycled and being task specific. Hence, to increase usage of composites
in the marine industry such policies are considered essential.
(c) Biofuels. Although the introduction of biofuels in shipping is technically possible with
support from the regulatory authorities in developing this costly fuel alternative, its
implementation faces a number of challenges. These include:
(i) Though the use of bio-derived fuel (called Fatty Acid Methyl Esters or FAME) was
incorporated in the marine fuel standards (ISO 8217) in 2017, it can be used only
for ships which have a limited option to decarburise (Nordic Energy 2020; UK P&I
2018).
12 N. AGARWALA

(ii) The recently introduced IMO Energy Efficiency Design Index (EEDI) (in July 2011)
for new ships does not provide any incentive for making engines compatible
with biofuels, as it takes into account tailpipe emissions as opposed to life
cycle emissions of fuels (IMO 2014).
(iii) With the biofuel costs being higher than marine fuels, the shift is not cost
effective (Ship Technology 2018).
(iv) The issue of GHG emissions has been discussed for over a decade, both by the
IMO and under the United Nations Framework Convention on Climate Change
(UNFCCC). However, both have failed to agree on GHG reduction targets as
even with maximum fleet efficiencies the goals laid down by UNFCCC cannot
be met by 2050 (IMO 2016).
(v) ISO standards on bio-derived fuels for the shipping sector are still a work-in-pro-
gress as they have found mention in the ISO only in 2017 and are limited to a
usage of a maximum of 7 per cent in concentration (IBIA 2017).
(d) Information and communication technology (ICT) has made huge inroads in the mar-
itime industry due to the need of optimising logistics management systems and oper-
ations. Similar to other industry sectors, such technology faces the risk of cyberattacks
from hackers and criminals all around the world. To date, international regulations
and policies, have mainly addressed the physical aspects of security and safety of
ICT while the regulation of cybersecurity has been voluntary. However, with increas-
ing risks, IMO has adopted guidelines on maritime cybersecurity risk management
(IMO 2017) but much more needs to be done as ICT is an ever-evolving field.
(e) A blockchain is a distributed ledger technology that is expected to improve the speed
and lower the cost of doing business (Deloitte 2016). It aims to simplify operations
and reduce the need of human involvement by automating the process and
remove human errors (Knect365 2016). In addition, it provides extra functions to
the transport and maritime information and communication technology and elec-
tronic data interchange systems, such as data verification, tracking and tracing.
This technology has, however, not yet been widely implemented in maritime ship-
ping. It is unclear whether this is likely to change soon, but still stakeholders
should move forward to take advantage of this technology (Czachorowski, Solesvik,
and Kondratenko 2019). Challenges include ensuring interoperability and a range
of legal issues (Takahashi 2017), as well as the need to devise mechanisms for the
effective incorporation of substantive maritime contract clauses and the replication
of the processes involved in blockchain-enabled smart contract-based information
technology systems.
(f) Drones and Unmanned Aerial Vehicles (UAVs) are used for surveillance and reconnais-
sance in unknown or hostile territories, such as the deep seas, aerial mapping, and for
monitoring critical infrastructure such as ports and power plants (Agarwala 2020). To
date, clear global procedures to regulate drone activities do not exist. The issues of
concern relate to accidents, collision, safety and security of these vehicles. Each of
these elements necessarily requires a detailed and effective regulation to address
security, privacy and legal concerns. Though some rules and policies have been
framed, primarily aimed at avoiding accidents in air, certain policy gaps exist which
include quality control and standardisation of the equipment used, lack of standard
operation procedures for incident management, lack of policy regarding privacy and
 AUSTRALIAN JOURNAL OF MARITIME & OCEAN AFFAIRS 13

threat management, air traffic management and legal liability for operations. A point
to be underlined here is that guidelines alone are not sufficient in ensuring
implementation and compliance. This essentially means that guidelines and circulars
issued by governments and multilateral agencies like the International Civil Aviation
Organization (ICAO) need to be converted into legal and policy instruments that
would have a binding effect on governments (Rajagopalan and Krishna 2018). For
this, it is essential that the necessary standards and norms that will ensure responsible
behaviour towards the use of drones are put in place first.
Though the Industry Code of Practice such as the Maritime Autonomous Surface
Ships (MASS) seeks to provide practical guidance for the design, construction and
safe operation of autonomous and semi-autonomous vessels under 24 m (Maritime
UK 2017; Li and Fung 2019), a more detailed regulatory framework needs to be devel-
oped to meet the requirements of forthcoming technological, commercial and regu-
latory developments (Porathe 2019).
(g) Use of Cloud. The cloud has been in existence since the advent of mainframes when
dumb terminals contacted the mainframe to perform actual computations on the
mainframe. With the advance in technology in the field of computers and telecom-
munication, on-demand availability of computer system resources has been the
norm of the day and is referred to as a ‘cloud’. Such an on-demand service includes
data storage and computing power without the need of direct, active management
by the user and allows achieving coherence and economies of scale with the user
focusing on his core business rather than IT issues (Goddard, n.d.).
In the maritime domain, for a safe operation and the voyage, the vessels and
shore-based facilities need to communicate with each other. To do so, they use a
variety of maritime systems that do the talking through an air gap, sometimes of
many kilometres. Such an effort requires expensive infrastructure investments such
as satellites, personnel training, and software licensing making the process costly
and at times unreliable. The cloud has come as a boon for the industry by providing
resources on a pay-per-use basis without having to invest in infrastructure, training or
licensing (CITRIX n.d.).
Since the cloud’s biggest disadvantage is the lack of security, in order to provide a
secure environment for data exchange, the IMO introduced the e-Navigation strategy
in 2007 (IMO 2014a) that uses a ‘Maritime Cloud’. It is essential to mention that the
maritime cloud is not a ‘cloud computing platform’ but aims to facilitate a secure
information exchange to maritime stakeholders for securely accessing technical ser-
vices so as to achieve better decision-making both onboard and ashore during a
voyage. It is conceptualised as a common communication framework that stores
data ‘in the clouds’ for maritime users using a standardised protocol and functional
support for identity management, authentication and encryption.
The biggest disadvantages of cloud computing is data breach (Lee and Park 2017),
technology lockdown to one service provider and cyber-attacks. In addition, the lack
of a policy framework to govern both the cloud and the information residing therein
is another limitation and a fear to be reckoned with. By introducing more complex ICT
infrastructure like the cloud, without a policy framework, we risk introducing new
threats in the maritime domain, such as piracy (Safety4Sea 2019), cyber espionage,
14 N. AGARWALA

phishing attacks, identity theft, stoppage of operations and maritime safety (Cyware
Social 2019; Maritime Global Security 2017).
(h) Use of Artificial Intelligence (AI) and Augmented Reality (AR). AR originally focused on
virtual games. Today, AR has entered the shipping sector and offers huge benefits.
By using AR, ship operators can gain support for operations and system problems
remotely by using real-time discussions with experts. With AI added to AR, the
entire process can be controlled from desktops and mobile phones. Such a technol-
ogy will allow faster solutions, while saving time and money on training and travel
(Moore 2018).
Another area where AI can contribute is by automating processes and tasks such
as navigation, without human control or management to make vessels safer, simpler
and more efficient. AI if properly deployed on vessels, can lead to self-diagnosing
equipment, capability to choose the most economical route without human interven-
tion, forming and separating of convoys when required, and cargo allocation to maxi-
mise capacity utilisation, to name a few.
Transiting to AI is unlikely to be smooth as there are a number of challenges
(McKinsey 2018; Love 2020). These include – who will lead, who will drive, what stan-
dards, the role of IMO, role of flag states, impact on seafarers and onshore managers,
and then the evergreen question of safety and responsibility in an exigency (DMA
2017). Yet another area wherein AI is being used extensively is managing maritime
marine pollution (Agarwala 2021) which too will need policy guidelines as the
usage increases.
(i) Internet of Things (IoT). With smarter ships, intelligent cargo tracking, automation and
a host of fringe technologies that are evolving in the maritime domain, the use of IoT
technology for increased connectivity to enable operators to become global logistic
experts is fast becoming the accepted norm. Using IoT, spaces such as the ship’s
engine room to cargo containers, and activities such as fleet management to con-
nected ports, are all falling together. This is helping in the day-to-day operations at
sea and at port and as part of a wider logistics network by allowing issues to be pin-
pointed, downtime to be reduced, and processes to be streamlined, changing the
face of the maritime industry, with the Port of Rotterdam leading the way (Riviera
2018). To ensure that the benefits of this technology and advancement are utilised
by the entire maritime industry, policies that would allow easy transformation to
this technology by all stakeholders within and across countries and continents are
considered essential.
(j) Use of Renewable Energy sources. With climate change being a focus area of the world,
use of renewable energy in various forms is increasing. Accordingly, the maritime
industry too is beginning to use solar energy, wind energy and electric ships so as
to reduce the carbon footprint due to fossil fuels. The use of these technologies,
like any other, however, requires regulations for their seamless implementation
which are still to be developed (Borthwick 2016; Koumentakos 2019)

From the foregoing discussion, it is quite clear that while disruptive technologies have
begun to leave a mark on the maritime industry, policy making is far from adequate and
will need to evolve with time, as new technologies develop. It is relevant to mention that
such a cycle is natural as discussed earlier in the article. However, for the maritime
 AUSTRALIAN JOURNAL OF MARITIME & OCEAN AFFAIRS 15

industry, policy making is slower due to the fact that the margins associated with the
industry are limited and more often than not, the owners focus on profits rather than
changes. Again, as mentioned earlier, many times, regulations follow implementations.
For the maritime industry, the process of implementation before regulation is slow or
negligible due to the associated costs, want of proven systems and the necessity of
onus of errors. It may be recalled that at times this burden may be difficult to define
due to involvement of different countries in registration, ownership, origin of cargo, des-
tination of the ship, consignee, and consignor, at any given moment of time and ship.

9. Discussion
As humanity prepares itself for Industrial Revolution 5.0 (use of robots and smart
machines to help humans to work better), we continue to struggle with the ongoing
Industrial Revolution 4.0 (transformation of industry using ICT) that is fundamentally alter-
ing our way of living, working and interaction with each other. Even today we are not
certain as to how the advancements of the present Industrial Revolution will unfold.
This thus demands that the resulting response to these changes should be a comprehen-
sive and an integrated one. This effectively requires that policy prescriptions for the
changes occurring due to the Industrial Revolution 4.0 are developed with consensus
so that the negative impact of the changes is kept to a minimum.
One realises that innovation and disruption have been a way of life for humans ever
since recorded history is available. However, the current disruptions are more alarming
as the innovations is not linear but exponential, forcing a focused attention on policy-
making to ensure that the ills of these disruptions are minimised. Though policy
making has always lagged disruptive changes, the current pace of disruptive technologies
is making the gap wider and fear looms large that it may lead to anarchy and chaos.
The current article has primarily focused on disruptive technologies in the maritime
domain and the need for policy-making for these technologies. It is prudent to realise
that the disruptive technologies of the maritime domain, as discussed, are not unique
to the maritime domain and have an imprint on the terrestrial domain too. However,
since the maritime domain is known to be slow to bring about changes through policy
due to an inherent inertia and involved costs, the resulting impact of these exponentially
evolving technologies is phenomenal which needs to be supported adequately with
timely policies to rein in the desired control and avoid an untoward incident.
The need for governance for disruptive technologies of the maritime domain takes
centre stage more so because of its growing impact on maritime trade, safety of ships,
environmental pollution and committed reduction of anthropogenic green-house
gases that are leading to climate change.
The article has focused on exciting the grey matter by providing a possible way ahead
to ensure greater maritime governance for the maritime industry and the commerce
associated with this industry. It by no means is exhaustive and conclusive due to the
nature of the ever evolving technologies. It merely encourages the idea of policy-
making through representative democracy for the maritime domain so as to ensure
greater stakeholder participation prior implementation of the legislations by the govern-
ments. Though, the resulting policy may not be ‘complete’ it is an essential step towards
16 N. AGARWALA

better governance of the evolving technological environment that is changing our lives
on a near daily basis.

10. Conclusion
A number of challenges exist for both the policy makers and the innovators in this age of
rapid technological developments. The regulations and business models intended for yes-
teryears fall short of addressing the requirements of this new age. There is a necessity to
balance the public interest and that of the innovators while creating a policy or it will
hamper the on-going pace of technological development and its adoption. The policy
makers need to understand that disruptive technology has the potential to both
reduce revenues and save money for the government. The need of the hour is hence
to leverage these changes to their advantage.
Given that the US lost an estimated US$ 4 trillion in economic vitality from 1980 to
2012 due to regulations alone (Coffey, McLaughlin, and Peretto 2016), getting rid of
those that are inane or that exist to rig parts of the economy is considered essential.
No industry is immune to disruption and hence needs to be deregulated enough, by
removing unnecessary regulations of the past, to encourage disruptive innovation
while at the same time ensuring public safety. In the words of the rocket pioneer
Wernher von Braun ‘We can lick gravity, but sometimes the paperwork is overwhelming’
(Redd 2013).
The deregulation when it happens would certainly create issues of public policy as gov-
ernments are likely to be confronted with displaced workers in which questions such as
‘What are the new jobs the technological change will create and the skills they will require?
What are the models to reskill and retrain the work force? How are the benefits of this tech-
nological change and the costs of its adjustment going to be shared?’ etc. need to be
answered.
There are no ready solutions for the problem at hand. What is certain though is that, for
governments to maintain their image and follow the requirements and ambitions of the
common man, policies are necessary to be made. This action needs to be done not reac-
tively but proactively and in time to allow growth with minimum social unrest, while
keeping the innovator motivated enough to create more and more disruptive
technologies.
This article has identified the disruptive technologies that are changing the future of
the maritime industry and the need for policy requirement. It can be noted that in the
case of the maritime domain, regulators need to learn to manage risks and not avoid
them. An appropriate policy framework is hence considered essential to help against
non-conforming quality and deviation from standards and help allocate ownership and
responsibility. Since the topic of policy making in the maritime domain is still developing,
it has been kept global rather than being country specific.

Notes
1. https://disruptionhub.com/2018-disruptive-trends/; https://www.pwc.co.uk/issues/intelligent-
digital/disruptive-innovation-emerging-technology.html; https://www.mckinsey.com/business-
functions/digital-mckinsey/our-insights/disruptive-technologies; https://mobilebusinessinsights.
 AUSTRALIAN JOURNAL OF MARITIME & OCEAN AFFAIRS 17

com/2018/01/disruptive-innovation-and-technologies-to-consider-in-2018/; http://bigthink.com/
flash-foresight/20-game-changing-technology-trends-that-will-create-both-disruption-and-
opportunity-on-a-global-level; http://fortune.com/2015/07/22/mckinsey-disruptive/
2. A stipulation that an agency or programme be disbanded or terminated at the end of a fixed
period unless it is formally renewed.

Disclosure statement
No potential conflict of interest was reported by the author(s).

Notes on contributor
Nitin Agarwala is a serving naval officer who has experienced various facets of a warship as a user,
designer, inspector, maintainer, policymaker, teacher and a researcher. He has authored over 70
articles, papers and book chapters and two books. The views expressed are his own and do not
reflect the views or policies of the Government of India or the Indian Navy.

ORCID
Nitin Agarwala http://orcid.org/0000-0003-0916-3044

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