Why would they want to decrease contact between Jewish and non-Jewish citizens?

This answer refers to Nazi Germany.

Explanation:

There were historical and contemporary reasons for the alienation, isolation and finally mass liquidation of Jews in Europe. There has long been a history of anti-semitism throughout Europe not only in Germany. They were blamed for the crucifixion of Christ and Jews have suffered pogroms for two millenia.

In the late 19th and early 19th century, spurious half baked theories emerged arguing that humans had developed different levels of evolution. The Aryan race was regarded as the most superior.

Hitler played on this and was helped considerably by the events that took place after WW1. The crushing terms imposed on Germany by the Treaty of Versailles, and the fact that Germany surrendered when the army was still fighting led to a widespread sense of betrayal and persecution. Hitler played on this, blaming world Jewry and Jewish control of the international banking system. When the Wall Street Crash happened, Germany was particularly badly hit because of its debts and Hitler exploited this fully in securing power, blaming the Jews and mounting a campaign of persecution, culminating in the murder of over 6 million Jews in Europe.