Why merge statement inserts all the data into the target table each time it runs?

I have these two table with same schema and records on different server and databases.

If the record in source table gets added or modified then it should be reflected in the target table as well but for some weird reasons it inserts all the rows in the target table each time.

I just want it to insert if new row gets added in the source or modified in the source.

Code:

MERGE INTO dbo.CountrySourceType AS target
USING (
				SELECT Id = Id * (- 1)
					, Name
					, (
						SELECT Id
						FROM country c
						WHERE ISNULL(c.Name, '') = (
								SELECT ISNULL(cs.Name, '') Name
								FROM [192.xxx.x.xxx].WebPortal.dbo.Country cs
								WHERE cs.Id = cst.CountryId
								)
							AND ISNULL(c.ContinentName, '') = (
								SELECT ISNULL(cs.ContinentName, '') ContinentName
								FROM [192.xxx.x.xxx].WebPortal.dbo.Country cs
								WHERE cs.Id = cst.CountryId
						)
				) CountryId
				FROM [192.xxx.x.xxx].WebPortal.dbo.CountrySourceType cst
				WHERE CountryId = cst.CountryId
				) AS source
				ON source.Id = target.Id
			WHEN NOT MATCHED BY target
				THEN
					INSERT (
						[Name],
						[CountryId]
						)
					VALUES (
						 source.Name
						,source.CountryId
		
						);

I tried it using the merge and narrowed down using the where clause but still it doesn't.

Try to avoid MERGE. Generally, you may have performances issues (among the other issues). You can simply add the source in a temporary table and just perform the update and insert by yourself.

DROP TABLE IF EXISTS #temp_table;

SELECT Id = Id * (- 1)
      , Name
      , (
        SELECT Id
        FROM country c
        WHERE ISNULL(c.Name, '') = (
                SELECT ISNULL(cs.Name, '') Name
                FROM [192.xxx.x.xxx].WebPortal.dbo.Country cs
                WHERE cs.Id = cst.CountryId
                )
            AND ISNULL(c.ContinentName, '') = (
                SELECT ISNULL(cs.ContinentName, '') ContinentName
                FROM [192.xxx.x.xxx].WebPortal.dbo.Country cs
                WHERE cs.Id = cst.CountryId
				)
		) CountryId

INTO #temp_table

FROM [192.xxx.x.xxx].WebPortal.dbo.CountrySourceType cst
WHERE CountryId = cst.CountryId

UPDATE dbo.CountrySourceType 
SET name = B.name
   ,County_id = B.CountryId
FROM dbo.CountrySourceType  A
INNER JOIN #temp_table B
	ON A.[Id] = B.[Id];


INSERT INTO dbo.CountrySourceType ([Name],[CountryId])
SELECT A.name, A.CountryId
FROM #temp_table A
LEFT JOIN dbo.CountrySourceType B
	ON A.[Id] = B.[Id]
WHERE B.[Id] IS NULL;

INSERT INTO dbo.CountrySourceType ([Name],[CountryId])
SELECT A.name, A.CountryId
FROM #temp_table A
LEFT JOIN dbo.CountrySourceType B
    ON A.[Name] = B.[Name]
	AND A.[CountryId] = B.[CountryId]
WHERE B.[Id] IS NULL;