Angela Merkel has joined a Muslim community rally in Berlin to promote tolerance, condemn the attacks in Paris and send a rebuke to Germany’s growing anti-Islamic movement.

“Hatred, racism and extremism have no place in this country,” she said in a speech earlier in the day. “We are a country based on democracy, tolerance and openness to the world.”

The vigil at Berlin’s Brandenburg Gate on Tuesday evening has been organised by the Central Council of Muslims in Germany under the banner “Let’s be there for each other. Terror: not in our name!”

German political leaders and religious leaders of different faiths, including Christians, Muslims and Jews were in attendance. Photograph: Sean Gallup/Getty Images

Imams recited Koranic verses, including a passage that condemns the taking of life. After speeches by Christian, Jewish and Muslim religious leaders and a minute’s silence, President Joachim Gauck addressed the several thousands of invited guests.

“Germany has become more diverse through immigration – religiously, culturally and mentally,” Gauck, a former pastor and East German dissident, told the group of several hundred next to the Brandenburg Gate. “This diversity has made our country successful, interesting and likeable.”

Thousands attend an anti-Islamisation rally in Dresden Guardian

Declaring in French “I am Jewish, I am Muslim”, Aiman Mazyek, head of the German Council of Muslims, added: “We stand together for a Germany that is open to the world, with a big heart, which honours freedom of opinion, of the press and of religion.” Christian and Jewish leaders also spoke.

Merkel, who is being joined at the event by most of her cabinet , has spoken out against the far-right Pegida group and stressed on Monday that “Islam belongs to Germany”.

Pegida drew a record 25,000 marchers to its 12th weekly rally in Dresden on Monday, its flag-waving members holding a minute’s silence for the victims of the Charlie Hebdo attacks in Paris last week.

The event was organised by the Central Council of Muslims in Germany under the banner ‘Let’s be there for each other. Terror: not in our name!’ Photograph: Kay Nietfeld/AFP/Getty Images

Its latest protest was met by some 100,000 counter-demonstrators nationwide, who accused Pegida of exploiting the French attacks by Islamist gunmen, and who voiced support for a multicultural German society.

Merkel has thanked leaders of Germany’s 4 million-strong Muslim community for quickly and clearly condemning the violence committed in the name of their faith in last week’s bloody attacks in Paris.

“Germany wants peaceful coexistence of Muslims and members of other religions” and the vigil would send a strong message, she said at a joint press conference with the Turkish prime minister, Ahmet Davutoglu.

Chairman of the Central Council of Muslims in Germany, Aiman Mazyek, German chancellor Angela Merkel, German vice chancellor, economy and energy minister Sigmar Gabriel. Photograph: John Macdougall/AFP/Getty Images

Rallies organised by Pegida, launched in October, have been growing week on week and spawned copycat groups nationwide.

The protests have been fuelled by a sharp rise in refugees seeking political asylum in Germany, which has been scrambling to house the newcomers in converted schools, office blocks and container villages.