Arrigo Saachi, the former Italy manager, is in contention to become the next manager of Israel.

Saachi, who led Italy to the 1994 World Cup final and twice led AC Milan to the European Cup, was confirmed as a candidate by Israel FA chairman Avi Luzon.

Reports from Italy say that Sacchi has been viewing DVDs of Israel’s recent games and has told friends that taking the Israel job is a challenge that interests him because the team has the potential to reach a higher level. He has not worked since he was director of football at Real Madrid in 2005.

Regardless of whether Sacchi is hired, Luzon told me: “He is one of the candidates being touted by agents as available. But I don’t know how realistic an option he is.” Luzon also confirmed that a foreign coach will definitely lead Israel in the Euro 2012 qualifying campaign. The next national team coach will not be an Israeli and I want to make the appointment by December.”

Asked if he thought there were no available, suitable Israeli candidates for the job, he replied: “That’s correct.”

Luzon appears to be defying public opinion, which has a strong preference for an Israeli rather than a foreign coach with Eyal Berkovic the preferred candidate.

But the IFA chairman has dismissed Berkovic’s credentials because they do not have coaching experience.

Following Israel’s disappointing World Cup qualifying campaign, Luzon is determined to appoint a world-class coach to replace Dror Kashtan. He had wanted Avram Grant to return to the position he had held from 2002-2005 but the Israeli’s return to the Premier League with Portsmouth scotched that plan.

The IFA’s hands are tied by budgetary constraints as they look to bring in a big name. Kashtan earns around £300,000-a-year, while Grant earns more than three times that at Fratton Park — and although Luzon is prepared to offer the right coach considerably more, it is questionable whether the IFA has the financial means to lure a manager of Sacchi’s status.

One option would be to recruit a wealthy sponsor to contribute towards the Israeli coach’s salary, in the same way that Chelsea owner Roman Abramovich pays Guus Hiddink’s salary for the Russian FA. But with Luzon eager to make an appointment by December, and certainly by the Euro 2012 qualifying draw in February, it is doubtful if a sponsor can be located in the coming weeks.

Eli Ohana, the Israel Under 19 team boss, will assist the new manager who Luzon hopes to have installed for the friendly against Romania on March 3.