At least 15 civilians have been killed in the Somali capital, Mogadishu, during renewed clashes between Ethiopian troops and insurgents.
Eyewitnesses say a troop carrier was mined
The shelling started after an Ethiopian convoy was mined 20km from the city on the southern road to Afgooye.
Eyewitnesses say there has also been a big explosion at an Ethiopian army complex south of the city.
Ethiopia helped government forces oust an Islamist group from Mogadishu last December but violence has continued.
The insurgents are believed to be a mixture of clan fighters and Islamists.
Aid agencies say Mogadishu is inhabited now only by soldiers, militia and men protecting what is left of their property.
The BBC's Adam Mynott says the thousands of people who fled the city in the past few weeks are facing a mounting humanitarian disaster.
According to eyewitnesses the convoy carrying Ethiopian troops travelling south was mined on Thursday morning, destroying one of the vehicles.
An estimated 4,000 people were wounded in recent clashes
Correspondents say it is not known what triggered the fighting in the city later in the morning.
"Six consecutive missiles hit... There are many wounded," said Hassan Ibrahim, as he drove a minibus full of the wounded to a hospital.
The shelling is centred around the central presidential palace, the former defence ministry and a former secondary school in the north.
An eyewitness who saw the explosion at the Ethiopian army base told the BBC Somali Service the rising debris and smoke looked like a "flying mountain".
He said people fleeing the area told him that after the blast Ethiopian troops started firing at people passing by; bodies are reported to be strewn along the street.
The United Nations says at least 200,000 people have fled Mogadishu since December, when the Union of Islamic Courts (UIC) were ousted.
Our correspondent says they are living scattered across southern and central Somalia in appalling conditions.
The fighting has made it very difficult for aid agencies to get help to those who need it.
Tens of thousands are destitute, many are injured and diseases like cholera have broken out.
There are also claims that the transitional government has blocked aid from getting to those some of those who need it.
Meanwhile, Somali Deputy Prime Minister Hussein Aideed has formed an alliance opposed to Ethiopia's presence in Somalia.
Hussein Aideed is a member of Mogadishu's Hawiye clan
He announced the move in the Eritrean capital and called for a probe into Ethiopia troops whom he accuses of genocide since arriving in December.
Islamist leader Sheikh Sharif Ahmed and former parliament speaker Sharif Sheikh Aden were also in Asmara at the launch.
Ethiopia and the US accuse Eritrea of supporting insurgents in Mogadishu, who are opposed to the transitional government.
"We also want the transitional government to be held accountable for the deaths of innocent civilians in Mogadishu," Mr Aideed told reporters in Asmara.
Mr Aideed, a former warlord and an influential member of the Hawiye clan, has called on Ethiopian forces to leave Somalia signalling sharp divisions in the transitional government.
On Tuesday, a meeting of the Somali parliament in Baidoa voted to expel 31 MPs currently in Asmara.
Ethiopia says it has started to withdraw some of its troops from Somalia and will gradually hand over responsibilities to the African Union force.
So far only 1,200 Ugandans have arrived, of the planned 8,000 strong force.
Eritrea and Ethiopia fought a border war several years ago and tensions remain fraught between them.