Jordan recognized Israel in the 1990s.
Netanyahu's denials of any link with the arms deal has been met with skepticism, particularly amid accusations that he bypassed Israel's defense establishment in agreeing to a past German sale of advanced submarines to Egypt.
A sticking point in the negotiations was Sudan's insistence that any announcement of Khartoum's delisting from terrorism designation not be explicitly linked to relations with Israel.
"We need Israel. Israel is a developed country and the whole world is working with it", he said. "We are co-operating with everyone".
White House press secretary Kayleigh McEnany said in a statement that the formal notification to Congress "follows on Sudan's recent agreement to resolve certain claims of United States victims of terror and their families". Some Islamist politicians, sidelined after the ouster of autocrat Omar al-Bashir, said they expect to receive renewed public support.
"Israel was completely isolated.Israel is now connecting to the whole world", he added.
"If you had asked me even three years ago or even three months ago if we would have an agreement between Sudan and Israel I would not have put the odds at a great betting odd", Meadows said.
The government has been struggling to revive Sudan's battered economy amid a huge budget deficit and widespread shortages of essential goods, including fuel, bread and medicine. Trump spoke in the Oval Office about the agreement, with Netanyahu joining him over the phone, and got in a dig at Democratic presidential nominee Joe Biden. Khartoum has since placed the funds in a special escrow account for victims of al-Qaeda attacks on USA embassies in Kenya and Tanzania in 1998.
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Trump said on Tuesday that once the funds were transferred, he would remove Sudan from the list.
The removal of the terror designation opens the door for Sudan's transitional government to get worldwide loans and aid needed to revive its battered economy and rescue the country's transition to democracy.
Sudan has had a transitional government since past year, when the military ousted longtime dictator Omar al-Bashir following a popular uprising. Bashir's government hosted wanted militants, including former Al-Qaeda leader Osama bin Laden, in the 1990s. The transitional government has promised elections as soon as 2022.
The umbrella organization called on the Palestinian Authority "to heed the wind of change, have a change of heart, choose peace over war, and finally return to the negotiating table in order to achieve a lasting peace with Israel". It has now formed the Sudanese transitional government demonstrating a honest desire to combat terrorism, to build democratic institutions, and improve its relations with its neighbors.
U.S. President Donald Trump listens while on a phone call with leaders of Sudan and Israel, in the Oval Office of the White House, in Washington, on October 23, 2020.
A statement from Sudan's Popular Congress Party, the second most prominent component of the Forces of Freedom and Change (FFC) political coalition, said Sudanese people are not obligated to accept the normalisation deal.
Despite the advances, several critical hurdles remain, including for the US victims of terror attacks who have legal claims against Sudan.
Trump announced on Monday he would take Sudan off the terrorism list once it deposited the $335 million it had pledged to pay in compensation.
The United Arab Emirates, which signed a normalisation deal with Israel in September, welcomed Sudan's decision to establish relations too as "historic".