Arsenal remain interested in signing Watford's in-form midfielder Nathan Chalobah despite reports that Chelsea are ready to offer him a new long-term contract.

The 18-year-old has played an integral role in helping Watford push for automatic promotion while playing for Gianfranco Zola's side on a season long loan. His impressive performances have seen him force his way into the England Under-21 set up and he is expected to be part of the squad that travels to Israel for the European Championships this summer.

Nathan Chalobah
Nathan Chalobah has excelled while playing on loan this season for Watford. [Reuters]

Reports emerged last week suggesting that Chelsea were aware of the interest from Arsenal and were hoping that Chalobah would commit his future to the Blues by signing a new contract in the summer.

Chelsea know they have a genuine talent in the young midfielder and would certainly not want to lose the player to one of their London rivals.

However, the Express reports that Arsenal are still keen to lure Chalobah away from Stamford Bridge and are hoping that the chance to push for a place in the first team will be enough to make him consider a move.

Despite an impressive season in the Championships, which could yet see Watford earn promotion, it is believed that the young midfielder will still be some way short of pushing for a place in the Chelsea first team.

Even with Frank Lampard out of contract at the end of the season, there are still the likes of Ramires, Jon Obi Mikel and Oriel Romeu to compete with for a place in central midfield.

Chelsea would certainly not want to lose one of their best prospects but the reports suggest that Arsene Wenger has taken a real interest in Chalobah and may offer him the chance to play more regularly at Arsenal.

For now Chalobah is simply concentrating on performing well for his country as he looks to help the Under-21 side pick up their ninth consecutive win against Austria tonight.

"We will try to put out a good performance again and keep the run going," Chalobah told the Express. "All the lads are ready and prepared for the game - and for this summer.

"It would be a great achievement for me to get to Israel. It's a big achievement just playing for the Under-21s, but getting to the finals is even better. It shows how well my season has been going if I manage to make the squad."