Multidex limit hitting while running unit test cases

I have an application where I have local unit tests ( test folder ) and instrumentation unit test cases ( androidTest folder ). Right now if I click on the androidTest folder, and click "Run All Tests", it throws the following exception.

Error:Error converting bytecode to dex:
Cause: com.android.dex.DexIndexOverflowException: field ID not in [0, 0xffff]: 65536

Error:Execution failed for task ':news-app:transformClassesWithDexForDebugAndroidTest'.
> com.android.build.api.transform.TransformException: com.android.ide.common.process.ProcessException: java.util.concurrent.ExecutionException: com.android.ide.common.process.ProcessException: org.gradle.process.internal.ExecException: Process 'command 'C:\Program Files\Java\jdk1.7.0_79\bin\java.exe'' finished with non-zero exit value 2

This exception is clearly because of hitting the multidex limit. But I have enabled multi-dex for debug build. I guess when the instrumentation test cases are run, they are run in debug mode. Then why is this exception occuring?

I am attaching the build.gradle file

apply plugin: 'com.android.application'
apply plugin: 'io.fabric'


android {
  compileSdkVersion 22
  buildToolsVersion 22.0.1

  defaultConfig {
    minSdkVersion 14
    targetSdkVersion 22
    applicationId "com.xyz"
  }


  buildTypes {

    debug {
      minifyEnabled false
      shrinkResources false
      multiDexEnabled true
    }

    release {
      minifyEnabled true
      shrinkResources true
      multiDexEnabled false
    }
  }

  lintOptions {
    warning 'InvalidPackage', 'GradleCompatible'
  }

  dexOptions {
    preDexLibraries true
    incremental true
    jumboMode = true
    javaMaxHeapSize "4g"
  }


  }
}

}