President Saddam Hussein of Iraq, adding to signs of increased moderation in Baghdad, said yesterday that he is interested in expanding diplomatic contacts with the United States despite Israel's use of U.S.-made aircraft to bomb an Iraqi nuclear reactor.

Saddam Hussein's remarks, on "Issues and Answers" (ABC, WJLA), came against a backdrop of extraordinary U.S.-Iraqi cooperation 10 days ago in negotiating a U.N. Security Council condemnation of Israel for the reactor bombing June 7. They also included two careful refusals to reiterate longstanding Iraqi rhetoric calling for replacing Israel by a secular state, and they seemed to be part of a calculated emphases on conciliatory positions to gain as much international good will as possible, particularly in the United States, following the attack on the reactor.

"American leaders have expressed their wish to develop relations and to give them an opportunity for Iraq to be sure that they are now thinking with a new mentality toward issues regarding the Arab nation and the Arabs in general," the Iraqi leader said. "So we are giving . . . them a part of this opportunity by moving the diplomatic relations futher, through the official meetings of the American charge here, and to treat his as a head of a diplomatic mission."

Iraq severed diplomatic relations with the United States after the 1967 Middle East war. But American diplomats work in Baghdad in a U.S. interests section, technically under the Belgian Embassy, and Iraqi diplomats work in Washington in an Iraqi interests section of the Indian Embassy.

Despite his otherwise encouraging word of U.S.-Iraqi relations, Saddam Hussein repeated Iraqi suspicions that the United States knew in advance of Israeli plans to bomb the reactor, saying, "The question mark is very big here."

"If a superpower like the United States of America, with all its intelligence media and with all its friendly relations with Israel, and if it didn't know preciously about this attack, therefore it is a very serious matter indeed," he added.

Saddam Hussein, interviewed in Baghdad wearing his uniform as commander of the Iraqi armed forces, puffed on a long cigar as he fielded questions for half an hour with apparent confidence. He responded in Arabic and his remarks were translated simultaneously into English for what was said to be his first interview on U.S. television.

The Iraqi leader insisted that the French-built Osirak reactor near Baghdad was not part of an effort to develop nuclear weapons, as affirmed by Prime Minister Menachem Begin of Israel to explain the air raid. Saddam Hussein recalled that scientists from France and the International Atomic Energy Agency have supported Iraq on this point.

At the same time, Saddam Hussein reiterated his call last week for an Arab nuclear weapon to enable Arab nations to deter Israel from use of nuclear weapons against them, saying, in the words of his interpreter:

"I did not address the countries of the world to provide Iraq with the capacity of manufacturing an atomic bomb. But I actually and exactly said that regardless of the intentions and the potentials of the Arabs, when Israel possesses a nuclear bomb, the atomic bomb, after all the peace-loving forces, then these forces ought to help the Arabs possess this kind of a weapon in order to preserve peace.

"That is to establish balance between the Israeli bomb, which Israel now actually possesses, and what with the Arabs not possessing any such weapon that will make Israel hesitate before using her nuclear arms against Iraq."

On the existence of Israel, Saddam Hussein avoided the tradidtional Iraqi insistence on dismantling the Jewish state. In an apparent effort to soften the public definition of Iraqi policy by reducing its clarity, he said:

"I am saying clearly that the arabs must not accept that they should be ruled by the Israeli law . . . How the future will be as to how, and how this entity [the Israeli state] is going to be, or what potential does this have, how the Jews and Arabs will coexist without any aggression or usurpation or oppression, this is something left for the masses, the people to decide."

Then, in response to a question, Saddam Hussein reaffirmed Iraq's rejection of U.N. Resolution 242, calling for recognition of Israel's right to exist within secure borders. But he suggested that refusal to envisage Israel's continued existence was not the reason, adding:

"I don't want to give propaganda for the Zionists in this aspect. But we are saying Iraq has rejected this decision because it does not give the Arabs their rights, doesn't fulfill . . . and does not protect them from Zionist aggression, and does not return to them their unsurped territories."