The objective of this work was to provide a more accurate prediction of well and reservoir performance for gas and gas condensate reservoirs by investigating near-wellbore effects. Specifically, the effects of non-Darcy flow and changes in relative permeability due to interfacial tension (IFT), and flow rate (modeled based on capillary number) on well productivity are considered. These effects are shown to be important factors affecting the productivity index (PI) of gas condensate wells. When only non-Darcy effects are considered, the condensate bank can cause an order of magnitude reduction in the PI. Hence, immediate remediation steps might be necessary for formations with high non-Darcy flow coefficients. The reduction in PI with increasing non-Darcy flow coefficient is also highly non-linear. The relative permeability improvement obtained at high capillary numbers on the other hand counteracts the PI reduction due to non-Darcy flow effects. This effect reduces the drop in PI due to condensate buildup and makes the drop in PI more gradual. Hence, both effects should be considered while studying the production performance of a gas condensate reservoir. The capillary number effect can in some cases overshadow the two-phase non-Darcy effects. Interestingly, when both non-Darcy and capillary number effects are present, the rate of decrease in the PI at or below the dew point is smaller than the case with the capillary number effect only. A case study of a lean-gas condensate reservoir, similar to the Arun field, was considered and a history match with the production data was performed. Simulation results are presented which clearly show that accurate prediction of PI based on laboratory measurements is possible using both non-Darcy and capillary number effects.