Why do I have an Apple Watch linked and creating backups on my iPhone?

If you feel an unauthorized person/app is remotely using, controlling or monitoring your device, then that is possible only if you have done one or more of the following Don'ts...

1. Don't hand over an iPhone to kids or to a stranger without Enabling Guided Access
2. Don't share Apple IDs
3. Don't Jailbreak
4. Don't share sensitive information pertaining to your device
5. Don't give in to Phishing
6. Don't plug in your device in Airports and Public places through third-party cables and trust the device. Beware of Juice Jacking. (Especially in India)
7. Don't leave your iPhone unlocked and unattended in public places like offices, schools, malls, etc.

If one of the above is true then quickly change the Apple ID Password and Return iPhone settings to their defaults.

Keep the iPhone updated to the latest iOS always and never Jailbreak. That's it.

iOS / iPadOS devices cannot be hacked or infected with Virus / Malware / Spyware unless you have intentionally downloaded spurious software or unauthorized apps directly from the internet and installed them on your device or/and have Jailbroken. 

It (Hacking) also depends on how careful you are in sharing sensitive and valuable information pertaining to your iPhone such as Passcode, Password, etc with your friends and family members.

Be judicious when sharing the device's sensitive and valuable information with friends and family members.

If you don't reckon what is said above is true then you have two options...

1. Report the hacking incident that you are facing to the local law enforcement authorities and follow it up
2. Believe it, it can't be hacked. There are people who still believe that the earth is flat and also some believe no one has ever landed on the moon. What can anyone do about that? This is a free world you can believe in anything, the choice is yours.

Kindly reach out to the Store/Individual/Agency from whom you acquired your iPhone. They would be best equipped to confirm whether the device was paired earlier with a watch.