In my books, terrorism is whatever my government says it is. Yes, it can be potentially pretty arbitrary.
Really, it does not matter if what your government says or does is wrong or right. What matters is that you know your government has its own, and your, interests in mind when it formulates its policies. Because of that, you pledge allegiance to what they do and follow what they say.
Remember ethics and idealism are very fickle things. Suicide bombers die thinking they are doing the right thing. The governments being terrorised and reacting accordingly also have soldiers fighting for what they think is the right thing. It is very relative. Before we get into an argument as to which is right, it does not matter.
Pick a side which you know will watch your back and provide your desires in life (pleasure, money, power, etc.). I don't know about you but money comes from capitalism, power from democracy/pluralism (unless you happen to be a dictator's son) and pleasure from a secular/non theocratic government (e.g. you can indulge in life's sins without worrying about religious police). Pretty much tells you which side to support, no? As long as my interests are taken care of, even if it means questionable policies, I will be part of it and follow them to the ends of the Earth.