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In this work, a parallel full Hybrid Electric Vehicle (HEV) was optimized to further lower its carbon footprint without opting for any additional hardware change. The study was focused to first recognize the system efficiency of the HEV and identify its low efficiency points over the MIDC. Thereafter, different functions of the HEV were studied for their individual and cumulative contribution in the fuel economy improvement over the base non-hybrid vehicle. This, along with the low system efficiency points helped in identifying the potential areas for improvement in fuel economy. With changes in calibration and control strategies resulting in an optimal torque handling between the E-machine and the ICE, it was established through simulation and subsequent experiments conducted on chassis dynamometer, that the fuel economy of the HEV tested can be improved with the performance remaining unchanged and emissions meeting regulatory requirements.