The definition of terrorism is using fear of violence as a political motivator, and I think we all agree that Luigi was trying to make a political statement through the use of violence. Agree or disagree with his message, that was his methodology.
But yes, in this case, this was a self-immolation protest, with no goal of causing fear. Even if a monk accidentally sets a bystander on fire as a result of demonstration, that is an accident, and no one has any reason to be afraid the monk will come for them next.
Hah I was going to make the same comment, but in response to this quote: