CAIRO - The Egyptian Government intends to seek clarifications from South Sudan on reports that it will build its first Embassy in Jerusalem, an Israeli newspaper said. The Jerusalem Post newspaper quoted South Sudan President Salva Kiir has agreed to a request by visiting Israeli MP Danny Danon that the newly independent state would build its first Embassy in Jerusalem rather than Tel Aviv. The South Sudan government has yet to officially confirm or deny the report. Both countries have agreed to establish diplomatic ties shortly after South Sudan had become officially independent in early July. Israel was one of the first states to recognise the new state and its Prime Minister Benjamin Netanyahu spoke on the phone with Kiir in July promising his country's assistance in areas of infrastructure, communications and agriculture. The Cairo-based Al-Masry Al-Youm newspaper quoted unnamed sources in the Egyptian Foreign Ministry as saying that they will contact Juba to affirm statements attributed to Kiir on the Jerusalem Embassy. Some Egyptian observers in the past expressed concern that Israeli meddling in Africa aims at disrupting its supply of the Nile waters. Cairo is already in the middle of a row with upstream Nile basin countries over re-allocation of water shares and amendments to colonial past agreements. The status of Jerusalem ��" a city holy to three religions ��" is a sensitive issue for Israel as well as Arab and Muslim states. Israel considers the city to be its "eternal and indivisible” capital city while Palestinians want the eastern part of Jerusalem to serve as the capital of a Palestinian state. Even the United States, Israel's staunchest ally, has been careful not to annoy the Arab and Muslim states by making any official sign that it recognises Jerusalem as the capital of the Jewish state. The US Congress passed a law in 1995 describing Jerusalem as capital of Israel and saying it should not be divided, but successive presidents have used their foreign policy powers to maintain the US Embassy in Tel Aviv and to back negotiations between Israel and the Palestinians on the status of Jerusalem. US diplomats say that, despite the US legislation, Washington's foreign policy is in practice broadly aligned with that of the United Nations and other major powers, which do not view Jerusalem as Israel's capital and do not recognise Israel's annexation of Arab East Jerusalem following the 1967 war.