Your intention and how your actions appear from the outside are different.
Inside Arjuna's hesitation to fight, there are feelings of affection for his relatives and a fear of committing sin. However, the enemies on the battlefield do not know these circumstances. They will perceive his withdrawal as an act of fleeing out of fear.
The meaning of an action does not necessarily conclude with one's own intentions. It is necessary to consider how it will be interpreted from the outside, within the given position and circumstances, and what consequences it may bring about. Krishna shows Arjuna the reality of the weight that withdrawal brings, precisely because Arjuna has been highly regarded.
Japanese Translation from the Geeta Press Edition - Chapter 2, Section 35: "Appears to have retreated due to fear."
Sanskrit original text
भयाद्रणादुपरतं मंस्यन्ते त्वां महारथाः ।
येषां च त्वं बहुमतो भूत्वा यास्यसि लाघवम् ॥ ३५ ॥Romanization
bhayād raṇād uparataṃ maṃsyante tvāṃ mahārathāḥ |
yeṣāṃ ca tvaṃ bahumato bhūtvā yāsyasi lāghavam || 35 ||And, those great warriors who admired you will think that you withdrew from battle out of fear, and they will begin to look down on you. (35)
"The Lord is indicating that the great warriors who had highly regarded Arjuna will come to look down on him."
On one side, there were great warriors such as Bhishma, Drona, and Shalya. On the other side, there were Virata, Dhrupada, Satyaki, and Drishtadyumna. They all had previously held Arjuna in very high regard, considering him a great hero, a great warrior, and a virtuous person. However, if Arjuna were to run away from the battlefield, they would come to look down on him.
Here, by bringing up the issue of "fear," the speaker is trying to make Arjuna understand the following: If he stops fighting, the Maharathee people will not think that his reason is due to pity or compassion for relatives. Also, they will not think that he did so because of a conviction that war is wrong.
They would naturally conclude that the true motive was "fear." And they would think that Arjuna fled the battlefield to save his own life. For him, stopping the battle in such a situation was the ultimate act of misjudgment.