Why group 1 elements are also called alkali metals ?
Because they produce alkaline aqueous solutions.
Group 1 elements are indeed called alkali metals because of what happens when they react with water.
The general form for the reaction of a group 1 element,
#2"M"_text((s]) + 2"H"_2"O"_text((l]) -> 2"MOH"_text((aq]) + "H"_text(2(g]) uarr#
These elements will react vigorously and, depending on which group 1 element you're dealing with, even explosively, with water to form their respective metal hydroxide,
The hydrogen gas will bubble out of the resulting solution, leaving behind the aqueous metal hydroxide.
This metal hydroxide is soluble in aqueous solution, which means that it dissociates completely to form the metal cation,
#"MOH"_text((aq]) -> "M"_text((aq])^(+) + "OH"_text((aq])^(-)#
The presence of the hydroxide anions makes the solution basic, or alkaline, which is why the group 1 elements are called alkali metals.
Here are the reactions of alkali metals with water