Surah 44. Ad-Dukhan, Ayah 32

I.e., according to all commentators, above all people of their time, because at that time the children of Israel were the only people who worshipped the One God: which is the reason of the frequent Qur'anic references to the story of their delivery from bondage. The stress on God's having "chosen them knowingly" alludes to His foreknowledge that in later times they would deteriorate morally and thus forfeit His grace (Zamakhshari and Razi).

From degrading servitude, Israel was delivered, and taken, in spite of many rebellions and backslidings on the way, to "a land flowing with milk and honey", where later they established the glorious kingdom of David and Solomon. This was not merely fortuitous. In Allah's decree it was to be a link in furthering His Plan. But their being chosen did not mean that they could do what they liked. In that sense there is no "chosen race" before Allah. But Allah gives every race and every individual a chance, and when the race or individual fails to live up to it, he or it must fall and give place to others.