The political party of icon Aung San Suu Kyi has rejected allegations by Burma's military government of ties to terrorist groups.

"We reject the accusation of having ties with terrorist groups. These are totally wrong," a National League for Democracy (NLD) spokesman said.

"We have no idea what their evidence is based on," Nyan Win told AFP.

Burmese Information Minister Brigadier General Kyaw Hsan has accused the NLD of links with foreign groups that had attacked Burma.

Analysts and a Western diplomat warned that the comments were a first step towards outlawing Burma's democracy party as a terrorist organisation.

No support

"The government has strong and irrefutable evidence that NLD was involved with anti-government groups as well as terrorist groups that would justify it being declared illegal," Kyaw Hsan said.

He however told reporters "we have decided to let it function".

"NLD no longer enjoys the support of the people, and it does not represent them any more," he added. The military frequently blames exiled dissidents in Thailand and others for periodic bombings inside the country.

The NLD, which denounces violence, won a landslide victory in elections in 1990 but the military-led government has never allowed the party to govern. Party leader and Nobel Peace laureate Aung San Suu Kyi has been under house arrest for more than 10 of the last 17 years.