We studied the effect of external pressure on the electrodynamic properties of $alpha$-Li$_2$IrO$_3$ single crystals in the frequency range of the phonon modes and the Ir $d$-$d$ transitions. The abrupt hardening of several phonon modes under pressure supports the onset of the dimerized phase at the critical pressure $P_c$=3.8 GPa. With increasing pressure an overall decrease in spectral weight of the Ir $d$-$d$ transitions is found up to $P_c$. Above $P_c$, the local (on-site) $d$-$d$ excitations gain spectral weight with increasing pressure, which hints at a pressure-induced increase in the octahedral distortions. The non-local (intersite) Ir $d$-$d$ transitions show a monotonic blue-shift and decrease in spectral weight. The changes observed for the non-local excitations are most prominent well above $P_c$, namely for pressures $geq$12 GPa, and only small changes occur for pressures close to $P_c$. The profile of the optical conductivity at high pressures ($sim$20 GPa) appears to be indicative for the dimerized state in iridates.
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