Sovereign AI and AI agents are set to play a major role in government AI adoption over the next two to five years, according to Gartner, Inc. The two technologies have reached the “Peak of Inflated Expectations” in the 2025 Gartner Hype Cycle for Government Services.
“Public sector leaders face mounting pressure to meet rising citizen expectations, navigate geopolitical uncertainty and do more with less resources,” said Dean Lacheca, VP Analyst at Gartner.
“AI agents can address these challenges, but success will depend on bridging the gap between innovation ambitions and broader government priorities to ensure investments strengthen services, trust and resilience.”
Gartner forecasts that by 2028, 65% of governments worldwide will introduce technological sovereignty requirements to improve independence and guard against extraterritorial regulatory interference.
By 2029, 60% of agencies globally are expected to use AI agents to automate more than half of citizen transactional interactions, up from less than 10% today.
Prompt engineering is also identified as a near-term technology, expected to reach mainstream adoption in the next two to five years.
“Governments are investing in AI solutions that work best when users create clear context-specific prompts,” Lacheca said. “They shouldn’t invest in AI solutions if they’re not willing to invest in the development of strong prompt engineering capabilities within their organisations.”
Machine customers, or nonhuman economic actors that purchase goods and services, are projected to grow from three billion B2B internet-connected machines today to eight billion by 2030. Governments will need to authenticate, provide services, and regulate these entities.
Lacheca noted, “Government leaders need to identify where adoption of machine customers by citizens and industries will require the reimagination of regulatory enforcement and service delivery.”
The Gartner Hype Cycle illustrates the maturity and adoption of emerging technologies and their potential to solve public sector challenges. Clients can access further insights in the report Hype Cycle for Government Services, 2025.
