Being multivariable in nature, voltage and current control loops have controllers in the forward and cross-coupling paths. Most methods discussed in the literature focus on tuning the controllers in the forward paths to reduce the dq coupling. A modified pole-zero cancellation (MPZC) technique has recently been discussed, which uses the concepts of pole-zero cancellation and particle swarm optimization to effectively tune the forward path controllers. However, given the fixed gains in the cross-coupling paths, it is not possible to realize a superior transient response from this technique. Therefore, to achieve enhanced vector control of VSIs under transient conditions, this paper proposes a hybrid MPZC (HMPZC) method, which incorporates multivariable control along with the MPZC technique for both voltage/current control loops. In the proposed HMPZC method, the MPZC method is used to tune the forward path controllers, and multivariable control-based PI controllers are assigned in the cross-coupling paths of dq-axes loops rather than fixed gains. In this paper, these multivariable control-based PI controllers are designed using direct synthesis method-based internal model control (IMC). From the simulation results, it is verified that the proposed HMPZC method has reduced the coupling between the d- and q-axes loops of the current/voltage, leading to the improved transient response and power delivery capability of VSIs.