Nangarhar police chief Mohammad Sharif Amin told Reuters that a bomber detonated a car packed with explosives outside the consulate and an adjacent mosque.
The consulate was the intended target, he said, but most casualties were from the mosque.
Roads near the Indian consulate remained blocked as gunfire rattled through the area, deputy provincial police chief Masoom Khan Hashimi said.
Indian diplomatic missions have been targets of previous attacks in Afghanistan.
More top news
NHS trusts are denying thousands of women across Britain fertility treatment in a bid to cut costs, a health watchdog has warned.
Overhaul of NHS would include workplace weight-loss schemes with money and shopping voucher prizes.
It is a wet and windy picture for many tonight, with the worst in the northwest.