Italy did allow dual citizenship in the early 90s. I know because one of my old friends holds dual Italian and British citizenship and, on his 18th birthday back in 1994, he received a letter demanding he report for Italian national service.
(NCd)
My DF married my (English) DM in the 1960s and moved here, having 2 kids (both UK citizens). In what we (at the time) saw as a waste of time, he registered our births with the Italian Embassy - making us Italian and UK citizens. Luckily the Italian army was a bit sexist so national service wasn't a worry
.
Anyway, returning to the thread, my DF was unable to apply for UK citizenship without giving up his Italian one. Obviously the ILR made it moot.
Just to throw another situation into the mix ... my DF never had a day off while he worked here - learning the language well enough to correct my teachers English (and Italian, and French and Spanish and German). My history teacher loved chatting to him, as he had grown up under Mussolini, and corrected some "facts" in our history books.
Sadly his working days in the UK came to an end when he was almost killed in a bank raid gone wrong - left him unable to work, just a burden to the state really.
Being a UK and Italian national, leaves me slightly ambivalent about Brexit.