AI has seen a massive adoption in the private sector, urging firms to consider replacing humans in jobs. However, the same can’t be said for the public sector yet, where AI’s arrival is yet to happen on a major scale. A report from Gartner, however, indicates that AI’s adoption in the public sector will be done by Sovereign AI and AI Agent, which are considered to be two key AI innovations.
Sovereign AI and AI Agents are at the ‘Peak of Inflated Expectations’ on the 2025 Gartner Hype Cycle for Government Services. The report suggests that both technologies are set to significantly influence public sector AI adoption over the next two to five years.
Public sector under pressure to modernise
Gartner’s Hype Cycle methodology provides a visual representation of how new technologies evolve over time, offering governments a roadmap to manage their deployment. The report highlights that public sector leaders are under increasing pressure to modernise services and improve efficiency with limited resources. As Dean Lacheca, VP Analyst at Gartner, stated, “Public sector leaders face mounting pressure to meet rising citizen expectations, navigate geopolitical uncertainty and do more with less resources.”
Sovereign AI
The report defines Sovereign AI as a nation-state’s efforts to develop and use AI to achieve its national objectives. Gartner predicts that by 2028, 65 per cent of governments worldwide will introduce technological sovereignty requirements to increase independence and protect against external regulatory interference. These initiatives aim to maximise the value of AI while reducing associated risks.
AI Agents
AI agents, which are defined as autonomous software entities that make decisions and take actions to achieve goals, are poised to automate a significant portion of government-citizen interactions. Gartner forecasts that by 2029, 60 per cent of government agencies globally will leverage AI agents to automate over half of their citizen transactional interactions, a substantial increase from less than 10 per cent in 2025. “Government leaders must incorporate AI agents into strategic planning by first identifying where they can deliver the most value,” said Lacheca.
The Gartner report also notes that prompt engineering is expected to reach mainstream adoption within the next two to five years, while machine customers — nonhuman economic actors — will become more prevalent in five to 10 years.
Both trends will require governments to redraw their regulatory frameworks and service delivery models to adapt to a new digital reality.
