Can someone explain why ice melts on increasing pressure based on Le Chatelier's principle? By the principle, ice will try to oppose increase in pressure. It can do so by increasing volume right? But on melting volume decreases
You almost answered your question, except that you deviated a bit. What you got wrong was the condition for equilibrium.
Equilibrium is that state at which any the system will try to counteract a an external change to the system. That is the primary definition of Le Chatelier's Principle also. So when we apply an external pressure to the ice-water system, the system will try to increase the pressure on the external agent, to keep the system, let's say, pressure-balanced. Like, when you do work on a system (like pushing a piston in a gaseous system that is in equilibrium), the system does work on you to keep it in equilibrium (the piston is pushed back). Same thing here. Now to increase the pressure on the external agent, the ice-water system can decrease its volume, and since water occupies a lower volume than ice, more ice is converted into water.