Liberalisation has increased Foreign Direct Investment (FDI) in India,both inward and outward. However, over these years, India has remained a net recipient of FDI. This paper seeks to examine the differential impacts of the variables on FDI inflows enforced in turn by Liberalisation policy in the country over these 30 years and above period. The study, used the Vector Error Correction model(VECM) depending on the long term Co-integration between the variables. It has used different macro-economic variables which are the exports and imports, the Gross Domestic Product, the Gross fixed capital formation, outward foreign direct investment etc as well as their lagged values over the years as some relevant factors, which in turn are impacted by Liberalisation policy in the country, to study their effect on this very vital source of non-debt capital inflows into the country. The lagged variables are used as many of these time series variables manifest their full impact only after a period of time. It has also highlighted the status of FDI inflows both during and after the Covid pandemic upheaval. The unprecedented pandemic ignited a financial crisis as Liberalisation has integrated all global economies, forcing every country to develop strategies to absorb the shock waves and gradually sail back to normality. However, it has also exposed the businesses to an environment of uncertain unsystematic risks and returns. As FDI inflows form a very vital component of a nation’s overall investment capital, it is relevant to assess its state in this liberalised world. It finds that, ‘Liberalisation’ significantly affects the inflows of FDI in the short run in a negative way , but it indirectly enhances the FDI inflows in the long run, by having a significant positive impact on all the variables in the short run, which in turn influences FDI inflows positively like the market size, domestic investment, exports, imports and current account balances which their expected results.For sustainability of this vital source of non-debt capital for any economy, streamlined policies to impact the explanatory variables as per the findings will enable the full realisation of the impact of liberalisation of the inflows of FDI, besides making these parameters stronger to withstand crisis, like the recent exemplified by the Covid pandemic.This is a major contribution towards supporting the 17th Sustainable Development Goals(SDGs), which is to ‘Strengthen the means of implementation and revitalise the global partnership for sustainable development’.