The head of the armed forces in Ecuador has announced the formation of a three-man council to take over the running of the country from President Jamil Mahuad.

The council has declared that it would support Vice-President Gustavo Noboa but there has been no response from him so far.

The military chief, General Carlos Mendoza said the council would be made up of himself, indigenous Indian leader Antonio Vargas, and former supreme court judge Carlos Solorzano.

He made the announcement at a news conference in the capital, Quito, after holding talks with indigenous protesters at the presidential palace.

General Mendoza said: "We will work to help the country, we will work against corruption and so that we are less poor."

He said he had the full support of the armed forces and promised full freedom for the country of 12.4 million people.

At the same time, he said he did not know the whereabouts of President Mahuad, who has not officially resigned and was last reported to have taken refuge at a military base with his ministers.

One report, quoting Antonio Vargas, said the president had been detained at Quito international airport. There has been no confirmation of this.

The junta says it plans to remove the state of emergency imposed by President Mahuad and hold elections as soon as possible.

Mr Mahuad had earlier left the palace after announcing that he would not bow to demands for his resignation.

Thousands of Indian protesters surrounded the building as calls intensified for him to step down.

Indians draped in Ecuadoran flags held a candlelit vigil outside the palace, which was being guarded by heavily armed troops.

Stormed parliament

Indian protesters sparked the power struggle by storming parliament on Friday and declaring a new government.

They say they have no faith in President Mahuad's ability to turn around the country's worst recession in decades. A military unit that joined the protesters stood aside to allow some 1,500 demonstrators into the empty building before joining the demonstration.

Salvador Quishpe, president of an Indian group that has been part of the protest, said: "We believe the armed forces' role has been crucial for this process of purification."

President Mahuad left the presidential palace - reportedly in an ambulance and with an armed escort - insisting he would not be forced from power.

He was driven to a military base and was reported to be under the protection of soldiers loyal to his administration.

In a speech to the nation, he insisted that he remained in control and he challenged his opponents to stage a coup if they want power.

He said: "In their ambition and lack of respect for democracy in Ecuador, the armed forces are trying to mount a coup d'etat. I call on the people to oppose this coup."

Looting and burning

Violence broke out in other parts of Ecuador as the protests spread.

An Ecuadoran radio station reported that one person was killed and three others were injured in clashes in Portoviejo, about 240km (160 miles) southwest of the capital Quito.

And in Guayaquil, the country's business capital, looters fought with police and set fire to cars.

Television pictures showed a rampaging crowd of about 300 people raiding shops as outnumbered police looked on helplessly.

President Mahuad's grip on power has been faltering in the face of the growing protests.

Indigenous Indians, who make up nearly half the population of Ecuador, have been particularly hard hit by the recession.

In recent months, the economy has floundered with runaway inflation, a currency crisis and falling exports.

A plan by President Mahuad to replace the Ecuadoran sucre with the US dollar has been rejected by Indian groups.

The Indians have also ruled out Vice President Gustavo Noboa as a replacement for Mr Mahuad.

Mr Noboa, who travelled to Quito from Guayaquil late on Friday, said he was ready to assume the country's presidency. He vowed to defend democracy and civil order.

Countries across Latin America are watching the uprising in Ecuador with concern.

Many governments in the region have publicly supported President Mahuad, while the United States warned that a successful coup attempt would mean economic and political isolation for Ecuador.

The Organization of American States gave its "full and determined backing" to Mr Mahuad and "firmly" condemned efforts to oust him.