Soviet Foreign Minister Alexander Bessmertnykh, meeting with Secretary of State James Baker, said Thursday he will visit Israel in May and that Moscow is moving toward re-establishing full diplomatic relations with the Jewish state.

"Our relations with Israel are developing, and if this tendency is continued in (the) future, there will be no difficulties in establishing full diplomatic relations," Bessmertnykh told Soviet journalists, the official Tass agency reported.Moscow's restoration of diplomatic ties with Israel would allow the Kremlin to co-host a regional peace conference on the Middle East, and Bessmertnykh indicated to reporters the Kremlin wants that role.

Baker, who flew to the northern Caucasus resort from Damascus, Syria, flew on to Jerusalem after the talks that also included a working lunch in which arms control was discussed. Bessmertnykh in turn flew back to the Soviet capital.

Obviously pleased at the progress he had made on setting up a conference, Baker said, "There is a better chance now than there has been in the past."

So far only Egypt has specifically agreed to attend a peace conference, so indications of Moscow's agreement to jointly sponsor the conclave clear at least another hurdle. But Jordan is widely believed to be willing to participate also.

Bessmertynkh's trip to Israel will be the highest-level visit ever by a Soviet diplomat to the Jewish state, which Moscow helped create at the United Nations in 1947.

It is also a vivid indication of the Kremlin's desire to share center stage with the United States at a peace conference, and to work constructively with its superpower partner.

When asked about re-establishing relations with Israel, Bessmertnykh said it depended on whether Israel and its neighbors could begin meaningful talks.

"I don't think it would be a problem, provided they start negotiating their dispute," Bessmertnykh said.

Baker said later that the Middle East peace conference is being held up by questions about which Palestinians would attend and the framework of the talks.

However, Baker told a news conference Thursday, "My honest feeling is that there is a better chance now than there has been in the past."

Baker will meet Friday in Jerusalem with Israeli Prime Minister Yitzhak Shamir, and he hopes to get Israeli approval of peace-conference terms acceptable to the Arab side.