Explosions and gunfire rocked the area near the Indian consulate in the eastern Afghan city of Jalalabad on Wednesday, shattering doors and windows and destroying at least eight cars, witnesses said.
There was no immediate word on casualties.
As gunfire rang out, security forces in armored vehicles were seen moving to the scene while civilians fled.
There was no immediate claim of responsibility for the blast, which followed a suicide attack on the nearby Pakistani consulate in January. That attack was claimed by Islamic State, which has a growing presence in Nangarhar province, of which Jalalabad is the capital.
In January, India's consulate in the northern Afghan city of Mazar-i-Sharif was also attacked by insurgents.
The explosion comes days after dozens of people were killed or wounded in suicide attacks in Kabul and the eastern province of Kunar, casting doubt on efforts to revive the stalled peace process with the Taliban.