The issue is that in Workflow Optimistic Provisioning was marked as false, due to which identity Event was getting created. However when i marked optimistic Provision as true the link is created.
<Variable editable="true" initializer="true" name="optimisticProvisioning">
<Description>
Set to true to enable optimistic provisioning. This will cause
changes to the entitlements compiled from role assignments to be
applied immediately to the identity cube rather than waiting
for the next refresh/reaggregation after the provisioning system
completes the request.
</Description>
</Variable>
Thanks