Petrov, who turns 34 in January, helped CSKA win the championship and domestic cup in 1997 before spells at Atletico Madrid, Manchester City and currently Bolton Wanderers.
"He will return to CSKA as playing director because he's one of the biggest names in Bulgarian football," Iliev told local media after meeting Petrov in England.
"It will not happen now but will happen within two years."
Pacy winger Petrov has scored 19 goals in 89 internationals.
CSKA reached three European semi-finals between 1967 and 1989 but have struggled to revive their success in recent years and have not won the domestic title since 2008.