This article evaluates the effectiveness of Indonesia's carbon trading policy implementation in the context of the newly established Indonesia Carbon Exchange (IDXCarbon). Despite the potential of carbon markets to support climate goals and economic transformation, early developments in Indonesia’s carbon exchange show signs of stagnation, limited participation, and unclear regulatory coordination. Furthermore, this article employs a multi-dimensional environmental justice framework assessing distributive, procedural, and recognition-based justice to critically examine whether the policy’s design and implementation not only facilitate market efficiency but also ensure equitable outcomes for all stakeholders, including indigenous communities, private sectors, and civil society. By situating Indonesia’s experience within global carbon market discourses and comparative international mechanism, this study offers insights that relevance to other developing economies seeking to leverage carbon trading as a tool for just and sustainable development. This paper explores the institutional, regulatory, and market-based factors contributing to the slow progress as specially on IDXCarbon. It also analyses policy opportunities and recommends strategic improvements for enhancing transparency, participation, and carbon market growth.