Is wealth created when money is transferred from a wealthy country to a less wealthy country? Imagine a person based in India is working for a client in the USA. The client pays the person 100 USD. The currency is converted into INR, which turns out to be 100 * 74 = 7400 INR.
But if we convert the currency according to Purchasing Power Parity rate, then it should have been 100 * 21.21 = 2121 INR.
So, the USA man is spending money which could have bought him 2121 INR worth of goods and services, but the Indian man is receiving money which can buy him 7400 INR worth of goods and services. So does that mean that 7400 - 2121 = 5279 INR worth of purchasing power is created out of thin air?
No purchasing power is not created from thin air. When you convert money through PPP (expressed usually in terms of local currency to USD) you are getting information about what is the purchasing power of US dollar that would get you the same basket of goods under the law of one price. This is not the same as making currency conversion with exchange rate which generally tells you not much about what would be the actual purchasing power of different currency.
Moreover, it is generally agreed by international trade economists that one of the major reasons why you will find discrepancies between exchange rate and purchasing power parity is the Balassa-Samuelson effect (See Krugman et al. International Trade Theory and Policy). This is because according to Balassa-Samuelson theory the price level in a country depends on productivity mainly in the tradable sector (mostly consisting of goods) because tradable and non-tradable sector (mostly consisting of services) compete for the same workers. This in turn means that if productivity in tradable sector increases it will increase wages not just in tradable sector but also in non-tradable sector.
This is the reason why hairdresser with exactly the same level of skill will get much higher wage in US than in India. However, this in turn leads to violation of law of one price as then also prices in non-tradable sector will be generally higher in US (e.g. haircut in US will be much more expensive than haircut in India).
Beside Balassa-Samuelsson effect, divergence between PPP and market exchange rate can be also due to transaction costs (which lead to failure of one price), differentiated goods (beef produced under strict EU health regulations is not the same beef as beef produced in some developing economy), fixed investment costs  that can also lead to deviations of law of one price and various composition issues when constructing price indecies (see Marrewijk International Economics: theory application and policy 2nd ed pp 471).
As a consequence of this there you will observe divergence between PPP and market exchange rate, but that is not the same as saying that some purchasing power was created out of nothing as they measure different things.