  We show that a strong infrared laser beam obliquely incident on graphene can
experience a parametric instability with respect to decay into lower-frequency
(idler) photons and THz surface plasmons. The instability is due to a strong
in-plane second-order nonlinear response of graphene which originates from its
spatial dispersion. The parametric decay leads to efficient generation of THz
plasmons and gives rise to quantum entanglement of idler photons and surface
plasmon states. A similar process can be supported by surface states of
topological insulators such as Bi$_2$Se$_3$.
