Chanakya posits that in the beginning human beings lived in the state of nature, as there was no concept of government. In some cases, people managed to live happily and peacefully in small groups. But the peace and happiness did not last because some people became wicked and started suppressing and exploiting the weak ones. There were no political institutions to control the wicked, and might alone was right. The state of nature society collapsed, and people suffered due to anarchy, lawlessness, and misery.
In the Arthashatra, Chanakya has coined the term ‘Matsya Nyaya’ (the law of the fish) to describe a state of nature society that is being destroyed by the rise of wickedness. Matsya Nyaya is the principle of a lawless pond in which the big fish devour the small fish. Chanakya posits that in the absence of ‘danda’ (strong stick of the law) society will be ripped apart by Matsya Nyaya, and that a strong government is critical for the maintenance of peace and stability.
The Arthashastra offers a surprising modern conception of governance. Here’s the Arthashastra’s verse 1.4.13-14:
अप्रणीतः तु मात्स्यन्यायं उद्भावयति ।
बलीयान् अबलं हि ग्रसते दण्डधराभावे ।
Translation: But when the law of punishment is kept in abeyance, it gives rise to such disorder as is implied in the proverb of law and order of fishes (matsyanyaya udbhavayati);
for in the absence of a magistrate (dandadharabhave), the strong will swallow the weak; but under his protection, the weak resist the strong.
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