Hi,
I have been a chakra linux user for the past 5 months and recently I moved on to arch-linux.

I see that there is no desktop folder in my home folder(/home/althor).

my desktop has been set to "Desktop Icons" activity. The problem I am facing is all my home folder(/home/althor) contents are visible in my desktop. Lets say my home folder contains the following folders.
Documents
Downloads
Projects
Stories

These 4 folders are visible in my desktop. Now If I delete these folders from my desktop, they get deleted from my home(/home/althor) also. It is as though a link has been created between my home and desktop plasma. I didnot face this issue in chakra linux. Also when I create a shortcut in my desktop by right clicking and selecting "Create new--> Link to Application" (for example I created a shortcut to Eclipse), the shortcut is visible in my home(/home/althor) folder. I believe this should go to /home/althor/Desktop. Please help me.

sounds like you are using the folderview activity not desktop and that you're set to use ~/ instead of ~/Desktop for the location. I say this because in desktop you can't directly right-click the desktop and create -> new

if you don't have a ~/Desktop then you can create one with mkdir ~/Desktop

No, I don't have folder view activity setup. From the activity bar(that has 3 balls in different colour) I selected desktop icons.

However, like you said, I created a Desktop folder in my home location and restarted my system. Now Desktop folder in visible in my desktop along with other folders and files from my home location.

I didnot have this issue while using chakra-linux.

what you have is a folder view widget on your desktop and it's set to ~/ and you want it to show ~/Desktop then just right click (in that widget) -> folder view settings -> show the Desktop folder.

Items shown in the folder view are not links per se, if you delete an item you do not delete a link but the actual item

fyi - you should have noted you were right clicking in the widget not in the desktop, they are different

Great Thank you. Working fine now