A variable speed AC motor drive, fed by a 3-phase AC supply, often consists of a 3-phase bridge diode rectifier, a DC link capacitor and a pulse width modulated inverter. Recently, a new type of capacitor known as film capacitor or slim capacitor has become popular for use in DC link. This capacitor has a lower value of capacitance and a longer life span than the conventional electrolytic capacitor. A film (slim) capacitor is advantageous over the electrolytic capacitor for use in the DC link because, for a low power motor, it results in a varying DC link voltage. This produces a less distorted grid current thereby improving the power factor. However, drives with slim DC link fed by a soft grid exhibits the tendency to oscillate at higher frequencies. This can be attributed to the LC resonance between the grid inductance and the small DC link capacitance, which results in significant but unwanted voltage ripples on the DC link. The unwanted harmonics affect the performance of the motor and the current drawn from the grid. As a result, the motor drive does not comply with the IEC 61000-3-2 harmonic standard. The objective of this project is to formulate, model and test a control algorithm to suppress the effects of the LC oscillations. This thesis proposes a novel compensation method that estimates the ideal DC link voltage without the unwanted ripples and feed-forwards the reconstructed DC link voltage to the motor drive algorithm, thereby altering the behavior of the motor drive to be more resistive such that the ripple gets damped. By doing so, the current drawn by the motor from the grid will have lesser harmonic content. Therefore, the power factor of the system will improve and the system will adhere to the harmonic standards.