Israel and a Chadian envoy discussed a possible upgrading of relations on Tuesday that would include a mutual exchange of ambassadors, Prime Minister Benjamin Netanyahu's office said.
Prime Minister Netanyahu said at the start of the meeting "I mentioned our relationship during the peace talks with the UAE. I would like not only to note our relationship, but also to promote it even further."
Chadian President Idriss Deby visited Israel in 2018 to start a process of reviving ties that the African country severed in 1972. Israel has cast the process as part of an outreach to the Arab and Muslim world.
That process now includes the announcement last month of a normalisation deal with the United Arab Emirates.
In Tuesday's talks, a Chadian delegation led by Abdelkarim Deby, the president's son, and Netanyahu discussed "appointing ambassadors and opening diplomatic missions, including (by Chad) in Jerusalem," a statement by the prime minister's office said.
Chad's Foreign Ministry said in a statement on late Tuesday it "categorically denies" any intention to open an embassy in Jerusalem.
According to the Israeli statement, the delegation – which included Chad's intelligence chief – also discussed bilateral cooperation on counter-terrorism and other matters.
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In a separate statement, Israeli Intelligence Minister Eli Cohen said Netanyahu government's would send a business delegation to develop possible mineral projects in Chad.
The Chadian delegation also met with Israel's National Security Adviser Meir Ben-Shabbat.