I am born in that race, so I am also wily, which is the characteristic of my own race, so I am not to blame in this, O Achyuta. Every thing has been created by thee and every thing is being destroyed by thee—and the species, form and nature of all things in the world, are thy work. Even such and I as thou hast created me in kind, in form and in nature. Such am I and such are my actions. Should I act differently then indeed should I deserve punishment; so thou hast destined. And that I have been punished by thee, is indeed a blessing—for punishment from thee alone is a favour.

In plain words: Kaliya argues that he acted cruelly because he was born a snake, and God made every creature the way it is. He would deserve punishment only if he went against his nature. He says being punished by Krishna is actually a blessing.