Since the first battles in May last year, which gave way in June to a tense stand-off, the armed forces have rearmed, modernised, and recruited.

Several hundred thousand troops are now under the colours, the airforce has sophisticated warplanes, and the army has hundreds of tanks and a sizeable number of field guns, western sources say.

"Our army is ready," Prime Minister Meles Zenawi told AFP in an interview Tuesday, when he warned that large scale warfare could resume "any day."

Some 320,000 Ethiopian soldiers and militiamen are facing off along the 1,000-kilometre (600-mile) border against some 270,000 Eritrean troops, diplomatic and Ethiopian sources say.

Military experts caution, however, that it is not easy to establish a modern and efficient army in just a few months.

On Thursday, according to the Ethiopian government, Eritrean artillery gunners bombarded Ethiopian positions in the northwestern Badme region for four hours.

Ethiopia has bought Sukhoi-27 fighter-bombers for its air force, as well as MI-8 and MI-24 helicopters, according to the Ethiopian press.

The air force has taken possession of eight Sukhois, and also has about 30 veteran but reconditioned MiG-21s and MiG-23s fighter-bombers.

Meles disclosed on Tuesday that foreign technicians were training the Ethiopian pilots.

They are understood to come from former Soviet countries such as Russia, Ukraine and Latvia, and number about 100 in all, who are under contract to Sukhoi, which is a Russian firm, and operating from the air force base at Debre Zeit, 45 kilometers (26 miles) south of Addis Ababa.

Witnesses have seen the aircraft on training flights above Axum, in the frontline Tigray region, and above Addis Ababa.

Ethiopia has also taken possession of two US Hercules C-130s -- workhorse propeller-driven planes that can land on short runways and are often used to transport troops and supplies, and drop paratroopers. They were ordered and paid for before the conflict with Eritrea broke out.

Asmara, for its part, has taken possession of MiG-29 interceptors, and Italian helicopters.

Ethiopia received about 100 T-55 tanks late last year from Bulgaria, reliable sources said, and since then war materiel and spare parts have been arriving aboard big transport planes landing at military bases at Bahir Dar in the northwest and Dire Dawa in the east.

Field guns, including "Stalin organs" -- multiple-rocket launchers -- have arrived, with ammunition from China, and the Addis Ababa ammunition factory has been put back in service.

Western sources estimate Ethiopia's military spending at more than 300 million dollars.

"It wouldn't be much for a country like France, but for us it's a lot," the prime minister said of his country's military spending while declining to put a figure on it.

Officially, 12 percent of Ethiopia's annual budget of 1.6 billion dollars -- 192 million dollars -- goes on the armed forces.

Western sources say that on top of this, some of the money coming from the privatisation of state firms and some of the income from firms still owned by the government has been used to buy war materiel.

Ethiopians at home and abroad have also contributed to the war chest