It's not racist to impose limits on immigration
It is, however, incredibly likely to appeal to and stir up racist sentiment. And it certainly IS racist to put up anti-immigration posters in close proximity to immigrant businesses and places of worship.
Michael Howard is not a racist. But he is fully aware of the racist, xenophobic sympathies he is appealing to, and his anti-immigration campaign is designed merely to stir up fear of the "other". This is how pogroms start - something of which Howard, considering his heritage, should be fully aware. Manipulate petty xenophobia and racism for political ends and soon the "petty" part ends up dropped. For short-term political gain, Howard is risking a long-term entrenchment and expansion of genuine racism - something which is not, and never has been, part of the British way of life.