Distant lands can have Strange Things.
Or consider, for instance, ginkgo trees. Today, there is only one species (Ginkgo biloba), from a single genus--and, indeed, the "only one left" goes up all the way to the division/phylum level. Two hundred million years ago, there were dozens of such species and they were distributed worldwide. Today? The solitary surviving species of this entire classification of plants grows wild only in a small region of China; the only reason we know of it worldwide today is because humans liked the colorful, interesting leaves so much, we planted them elsewhere for decoration. Coelacanths were thought to be extinct for decades until we found living specimens. Hell, we thought kiwi were extinct for a good long while, until we found out no, they aren't, they're just very good at hiding from people because people almost drove them to extinction.
It's eminently possible that a species can exist, survive, perhaps even thrive in various forms of isolation from the world around it. Even sapient species. Homo floresiensis, aka the "hobbits", lived undisturbed on an island in Indonesia until about 50,000 years ago.
All you need is the right kind of isolating environment and local sustainability. Even without an isolating environment, it really truly is only in the past like 300-400 years that humans have even begun to have a good idea of what is beyond their local region. Remember, the ancient Greeks (ca. 500 BC) genuinely believed there were dog-headed people just a couple thousand miles east of them. Egyptians in the following thousand years likewise believed that dog-headed people existed; the Coptic St. Christopher, for example, was held to have had two dog-headed attendants who were fiercely loyal to him. And that's stuff that should've been verifiable even to them--it's not like India was inaccessible to the Greeks, Alexander tried to conquer it.
So...no, I don't buy the idea that a distinctly medieval-stasis world where knowledge gets lost easily and even folks who DO travel rarely go more than 1500 miles from their place of birth. (That's about the radial extent one could expect from a very well-travelled Roman during the time we would call the "Roman Empire", reaching the British Isles, Scandinavia, most of Egypt, parts of the Levant, etc. Even if you put a similar circle centered on Baghdad, often the cultural if not political center of Golden Age Islam, it barely gets you Pakistan, to say nothing of India proper--and that 1500-mile Baghdad circle only has like ~20% overlap with the previous!)